TFMI — Interim / Quarterly Report 2021

Dec 9, 2021

Stock Code: 2832

Taiwan Fire & Marine Insurance Co., Ltd.

Financial Reports and ICPA’s Review Report First Quarter, 2021 and 2020

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Address: 8-9F., No. 49, Guanqian Rd., Taipei 100, Taiwan (R.O.C) Tel: +886 2 2382 1666

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§ TABLE OF CONTENTS §

Item I. Cover II. Table of Contents III. ICPA’s Review Report IV. Balance Sheet V. Statement of Comprehensive Income VI. Statements of Changes in Equity VII. Statements of Cash Flows VIII. Notes to Financial Statement (I) Company Profile (II) Date and Procedure for Authorization of Financial Statements (III) Applicability of Newly Promulgated And Amended Standard Rules And Interpretations (IV) Summary of Significant Accounting Policies (V) Major Sources of Major Accounting Judgments, Estimate And Hypotheses (VI) Important Accounting Items (VII) Related Party Transactions (VIII) Pledged Assets (IX) Major Contingent Liabilities and Commitments Made Under Unrecognized Contracts (X) Loss of Material Disaster (XI) Subsequent Events (XII) Others (XIII) Additional Disclosures 1. Information about significant transactions 2. Information related to reinvested enterprises 3. Information about investment in mainland china 4. Information about major shareholders (XIV) Information about Segment	Page 1 2 3 4 5~7 8 9~10 11 11 11~16 17 18 18~57 57~64 - - - - 64~94 94 94~95 94 94, 96 94	Note No.
		- - - - - - - 1 2 3 4 5 6~23 24 - - - - 25~29 30 30 30 30 31

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ICPA’s Review Report

To Taiwan Fire & Marine Insurance Co., Ltd.:

Prelude

We, as the CPAs, have completed the review of the balance sheets dated March 31 of 2021 and 2020 and the consolidated comprehensive income statement, consolidated statement of changes in equity, consolidated statement of cash flows, and consolidated financial statement from January 1 to March 31 of 2021 and 2020, including summaries of major accounting policies of Taiwan Fire & Marine Insurance Co., Ltd. Based on the Regulations Governing the Preparation of Financial Reports by Insurance Enterprises, and the International Accounting Standards No. 34 “Interim Financial Reporting” recognized and released by the Financial Supervisory Commission, the preparation of financial statements fairly presented is the responsibility of the management. The responsibility of the CPAs is to conclude the financial statements based on the result of review.

Scope

The CPAs have performed the review based on Statements on Auditing Standards No. 65 “reviews of financial statement.” The procedures performed during the review of financial statements include inquiries (mainly the inquiries to the personnel in charge of finance and accounting affairs), analytical procedures and other review procedures. The scope of review is apparently smaller than the scope of an audit; therefore the CPAs may not detect all the material matters that may be identifiable under audit, and thus no audit opinion may be provided.

Conclusion

Based on the results of review, as CPAs, we do not find any incompliance in the preparation of the above-mentioned financial statements, in all major respects, with the Regulations Governing the Preparation of Financial Reports by Insurance Enterprises and the International Accounting Standards No. 34 “Interim Financial Reporting” recognized and released by the Financial Supervisory Commission, that may result in inability to fairly presented the financial position of Taiwan Fire & Marine Insurance Co., Ltd. as of March 31, 2021 and 2020, and the financial performance and cash flows during January 1 to March 31, 2021 and 2020.

Deloitte & Touche CPA: Wang-Sheng Lin CPA: Wen-Ya Hsu

Financial Supervisory Commission Approval No. Securities and Futures Commission Approval No. Jin-Guan-Zheng-Shen-Zi No. 1060023872 Tai-Cai-Zheng-Liu-Zi No. 0920123784

April 29, 2021

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Taiwan Fire & Marine Insurance Co., Ltd. BALANCE SHEET

March 31, 2021, and December 31, and March 31, 2020

Unit: NT$ thousand

Code 11000 12100 12210 12500 12000 12600 14110 14150 14180 14190 14200 14000 15100 15200 15300 15000 16000 16700 17100 17800 18300 18700 18000 1XXXX Code 21200 21400 21500 21600 21000 21700 23800 24100 24200 24400 24500 24000 27000 28000 25300 25900 25000 2XXXX 31100 32100 32200 32000 33100 33200 33300 33000 34000 3XXXX	ASSETS CASH AND CASH EQUIVALENTS (Note 6, 24) RECEIVABLES (Note 7) Notes receivable Premiums receivable Other receivables Total receivables INCOME TAX ASSETS OF THE PERIOD (Note 21) INVESTMENTS Financial assets at fair value through profit or loss (Note 8, 23) Investments accounted for using equity method(Note 11) Other financial assets - net (Note 12) Fair value through other comprehensive income financial assets(Note 9, 10 and 23) Investment properties (Note 13) Total investments REINSURANCE CONTRACT ASSET (Note 18, 25 and 26) Claim recoverable from reinsurers - net Due from reinsurers and ceding companies Reinsurance reserve asset - net Total reinsurance contract asset PROPERTY AND EQUIPMENT (Note 14) RIGHT-OF-USE ASSETS (Note 15) INTANGIBLE ASSETS DEFERRED INCOME TAX ASSETS OTHER ASSETS Refundable deposits (Note 16) Other assets - others Total other assets TOTAL LIABILITIES AND EQUITY PAYABLES Claims payable Commissions payable Due to reinsurers and ceding companies Other payable Total payables INCOME TAX LIABILITIES OF THE PERIOD (Note 21) LEASE LIABILITIES (Note 15) INSURANCE LIABILITIES (Note 18, 25 and 26) Unearned premium reserves Claim reserves Special reserves Premium deficiency reserves Total insurance liabilities PROVISIONS(Note 17) DEFERRED INCOME TAX LIABILITIES OTHER LIABILITIES Guarantee deposit received (Note 24) Other liabilities - others Total other liabilities Total liabilities EQUITY(Note 19) Common stock Capital surplus Issuance of common shares in excess of par Treasury stock transactions Total capital surplus Retained earnings Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity Total equity TOTAL		March 31, 2021 (Reviewed) Amount % $ 4,711,142 22 108,086 1 1,223,544 6 100,420 - 1,432,050 7 920 - 2,205,360 10 256,126 1 2,845,951 13 4,879,170 22 2,156,771 10 12,343,378 56 1,413 - 129,806 1 1,884,410 8 2,015,629 9 462,909 2 42,815 - 10,537 - 60,462 - 714,357 4 50,893 - 765,250 4 $ 21,845,092 100 $ 74 - 534,405 2 430,444 2 792,413 4 1,757,336 8 38,918 - 67,025 - 4,913,537 23 3,053,069 14 2,128,957 10 6,437 - 10,102,000 47 81,286 1 264,150 1 35,593 - 34,774 - 70,367 - 12,381,082 57 3,622,004 16 1,915 - 97,047 1 98,962 1 2,381,521 11 2,561,462 12 473,931 2 5,416,914 25 326,130 1 9,464,010 43 $ 21,845,092 100		December 31, 2020 (Audited) Amount % $ 3,684,530 19 96,108 1 485,363 2 83,989 - 665,460 3 - - 1,938,689 10 242,485 1 2,969,507 15 4,658,775 24 2,286,757 12 12,096,213 62 21,081 - 171,016 1 1,727,274 9 1,919,371 10 356,406 2 45,751 - 9,957 - 36,700 - 727,917 4 38,331 - 766,248 4 $ 19,580,636 100 $ - - 139,163 1 368,995 2 486,220 2 994,378 5 38,823 - 71,498 - 3,447,801 17 2,894,345 15 2,118,699 11 7,588 - 8,468,433 43 82,378 1 266,669 1 34,899 - 43,025 1 77,924 1 10,000,103 51 3,622,004 18 1,915 - 97,047 1 98,962 1 2,381,521 12 2,571,709 13 797,593 4 5,750,823 29 108,744 1 9,580,533 49 $ 19,580,636 100		March 31, 2020 (Reviewed)	March 31, 2020 (Reviewed)
			Amount $ 4,711,142 108,086 1,223,544 100,420 1,432,050 920 2,205,360 256,126 2,845,951 4,879,170 2,156,771 12,343,378 1,413 129,806 1,884,410 2,015,629 462,909 42,815 10,537 60,462 714,357 50,893 765,250 $ 21,845,092 $ 74 534,405 430,444 792,413 1,757,336 38,918 67,025 4,913,537 3,053,069 2,128,957 6,437 10,102,000 81,286 264,150 35,593 34,774 70,367 12,381,082 3,622,004 1,915 97,047 98,962 2,381,521 2,561,462 473,931 5,416,914 326,130 9,464,010 $ 21,845,092		Amount $ 3,684,530 96,108 485,363 83,989 665,460 - 1,938,689 242,485 2,969,507 4,658,775 2,286,757 12,096,213 21,081 171,016 1,727,274 1,919,371 356,406 45,751 9,957 36,700 727,917 38,331 766,248 $ 19,580,636 $ - 139,163 368,995 486,220 994,378 38,823 71,498 3,447,801 2,894,345 2,118,699 7,588 8,468,433 82,378 266,669 34,899 43,025 77,924 10,000,103 3,622,004 1,915 97,047 98,962 2,381,521 2,571,709 797,593 5,750,823 108,744 9,580,533 $ 19,580,636		Amount $ 3,217,590 122,904 492,048 102,166 717,118 - 1,815,888 212,547 3,134,307 4,167,752 2,309,791 11,640,285 73,425 165,079 1,784,249 2,022,753 389,372 30,948 4,440 28,797 730,008 45,981 775,989 $ 18,827,292 $ 1,056 138,551 422,668 742,773 1,305,048 98,591 62,188 3,418,920 2,832,624 2,138,668 7,333 8,397,545 83,990 272,473 34,198 39,256 73,454 10,293,289 3,622,004 1,915 97,047 98,962 2,242,269 2,398,378 541,321 5,181,968 368,931 ) 8,534,003 $ 18,827,292	%
						(		17 1 3 - 4 - 10 1 17 22 12 62 - 1 10 11 2 - - - 4 - 4 100 - 1 2 4 7 1 - 18 15 12 - 45 - 2 - - - 55 19 - 1 1 12 12 3 27 ( 2 ) 45 100

Subsequent notes are incorporated as part of this individual financial statement.

President: Chao-Feng Chen

Chairman: Steve Lee

Chief Accountant: Pi-Chen Wang

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Taiwan Fire & Marine Insurance Co., Ltd.

Statement of Comprehensive Income

From January 1 to March 31, 2021 and 2020

(Reviewed only, not audited based on the GAAS)

Unit: NT$ thousand, except earnings (loss) per share NT$

Code OPERATING REVENUES Retained earned premium 41110 Direct insurance premium revenues(Note 24, 25) 41120 Reinsurance premium revenues 41100 Premium revenues 51100 Less: Reinsurance premium outward 51310 Less: Net change in unearned premium reserves (Note 18, 25) 41130 Total retained earned premium 41300 Reinsurance commission earned 41400 Handing fee earned Net gains on investments 41510 Interest income 41521 Gain on financial assets and liabilities at fair value through profit or loss (Note 20) 41527 Realized gain and losses on financial assets at fair value through other comprehensive income 41540 Share of profit of associates and joint ventures accounted for using equity method 41550 Exchange gain (loss) - investment	From January 1 to March 31, 2021 Amount % $ 3,438,606 198 96,474 5 3,535,080 203 634,126 36 1,351,832 78 1,549,122 89 64,667 4 14,143 1 27,007 1 44,631 3 275 - 13,641 1 1,787 -	From January 1 to March 31, 2021 Amount % $ 3,438,606 198 96,474 5 3,535,080 203 634,126 36 1,351,832 78 1,549,122 89 64,667 4 14,143 1 27,007 1 44,631 3 275 - 13,641 1 1,787 -	From January 1 to March 31, 2020	From January 1 to March 31, 2020	From January 1 to March 31, 2020
		Amount $ 3,438,606 96,474 3,535,080 634,126 1,351,832 1,549,122 64,667 14,143 27,007 44,631 275 13,641 1,787		Amount $ 1,769,236 95,123 1,864,359 612,947 99,678 1,151,734 59,530 14,115 31,096 24,471 ) - 5,392 ) 1,436	%
			( (		139 7 146 48 8 90 5 1 2 ( 2 ) - - -

(To be continued)

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(Continued)

Code 41570 Gain (loss) on investment properties (Note 20, 24) 41585 Expected credit impairment losses and reversal of gains of investments 41800 Other operating revenues 41000 Total operating revenues OPERATING COSTS Retained claims 51200 Claims incurred (Note 24, 25) 41200 Less: Claims recovered from reinsurers 51260 Total retained claims Movement of insurance liability (Note 18, 25) 51320 Net change in claims reserves 51340 Net change in special reserves 51350 Net change in premium deficiency reserves 51300 Total net change in insurance liability 51500 Commission expenses(Note 24, 25) 51800 Other operating cost 51000 Total operating costs OPERATING EXPENSES (Note 4, 17, 20 and 24) 58100 Service Expenses 58200 Administrative Expenses 58300 Employee training expenses 58400 Impairment loss and reversal gain on expected credit - non- investment 58000 Total operating expenses (To be continued)	From January 1 to March 31, 2021 Amount % $ 24,052 1 61 - 402 - 1,739,788 100 743,621 43 127,783 8 615,838 35 115,492 7 10,258 - ( 1,151) - 124,599 7 617,431 36 13,719 1 1,371,587 79 304,026 18 94,001 5 127 - 16,526 1 414,680 24	From January 1 to March 31, 2021 Amount % $ 24,052 1 61 - 402 - 1,739,788 100 743,621 43 127,783 8 615,838 35 115,492 7 10,258 - ( 1,151) - 124,599 7 617,431 36 13,719 1 1,371,587 79 304,026 18 94,001 5 127 - 16,526 1 414,680 24	From January 1 to March 31, 2020	From January 1 to March 31, 2020	From January 1 to March 31, 2020
		Amount $ 24,052 61 402 1,739,788 743,621 127,783 615,838 115,492 10,258 1,151) 124,599 617,431 13,719 1,371,587 304,026 94,001 127 16,526 414,680		Amount $ 45,475 67 - 1,273,590 738,125 200,476 537,649 47,664 3,281 ) 179 44,562 211,610 10,806 804,627 214,560 88,337 109 1,418 304,424	%
	(		(		4 - - 100 58 16 42 4 ( 1 ) - 3 17 1 63 17 7 - - 24

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(Continued)

Code 61000 OPERATING INCOME (LOSS) 59000 NON-OPERATING INCOME AND EXPENSES 62000 Net income (loss) before income tax from continuing operation 63000 Income tax benefits (expenses) (Notes 4 and 21) 66000 Current net income (loss) OTHER COMPREHENSIVE INCOME Items that will not be reclassified subsequently to profit or loss 83190 Equity instruments valuation profit or loss measured at fair value through other comprehensive income Items that may be reclassified subsequently to profit or loss 83290 Debt instrument profit or loss measured at fair value through other comprehensive income 83000 Total other comprehensive income, net of income tax 85000 TOTAL COMPREHENSIVE INCOME IN THE PERIOD Earnings (loss) per share (Note 22) 97500 Basic earnings (loss) per share 98500 Diluted earnings (loss) per share	From January 1 to March 31, 2021 Amount % ( $ 46,479 ) ( 3 ) ( 867) - ( 47,346 ) ( 3 ) 26,186 2 ( 21,160) ( 1 ) 319,851 18 ( 16,793) ( 1 ) 303,058 17 $ 281,898 16 ($ 0.06) ($ 0.06)	From January 1 to March 31, 2021 Amount % ( $ 46,479 ) ( 3 ) ( 867) - ( 47,346 ) ( 3 ) 26,186 2 ( 21,160) ( 1 ) 319,851 18 ( 16,793) ( 1 ) 303,058 17 $ 281,898 16 ($ 0.06) ($ 0.06)	From January 1 to March 31, 2020	From January 1 to March 31, 2020	From January 1 to March 31, 2020
		Amount $ 46,479 ) 867) 47,346 ) 26,186 21,160) 319,851 16,793) 303,058 $ 281,898 $ 0.06) $ 0.06)		Amount $ 164,539 816) 163,723 33,403) 130,320 323,801 ) 1,811 321,990) $ 191,670) $ 0.36 $ 0.36	%
	( ( ( ( ( ( (		( ( ( ( (		13 - 13 ( 3 ) 10 ( 25 ) - ( 25) ( 15)

Subsequent notes are incorporated as part of this individual financial statement.

Chairman: Steve Lee

President: Chao-Feng Chen

Chief Accountant: Pi-Chen Wang

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Unit: NT$ thousand

Taiwan Fire & Marine Insurance Co., Ltd.

STATEMENTS OF CHANGES IN EQUITY From January 1 to March 31, 2021 and 2020 (Reviewed only, not audited based on the GAAS)

Code A1 Balance at January 1, 2020 Appropriation of 2019 earnings B5 Cash dividends distributed by the Company B17 Reversal of special Reserve D1 Net Profit from January 1 to March 31, 2020 D3 Other comprehensive income after taxes from January 1 to March 31, 2020 D5 Total comprehensive income from January 1 to March 31, 2020 Z1 Balance at March 31, 2020 A1 Balance at January 1, 2021 Appropriation of 2020 earnings B5 Cash dividends distributed by the Company B17 Reversal of special Reserve D1 Net loss from January 1 to March 31, 2021 D3 Other comprehensive income after taxes from January 1 to March 31, 2021 D5 Total comprehensive income from January 1 to March 31, 2021 Q1 Disposal of equity instruments at fair value through other comprehensive income/Disposal of equity instruments at fair value through other comprehensive income by associates Z1 Balance at March 31, 2021		Capital $ 3,622,004 - - - - - $ 3,622,004 $ 3,622,004 - - - - - - $ 3,622,004	Capital surplus $ 98,962 - - - - - $ 98,962 $ 98,962 - - - - - - $ 98,962			Retained Earnings	Unappropriated earnings $ 756,029 ( 362,201 ) 17,173 130,320 - 130,320 $ 541,321 $ 797,593 ( 398,421 ) 10,247 ( 21,160 ) - ( 21,160) 85,672 $ 473,931	Other Equity (Note 19) Unrealized Gain and Losses on Financial Assets at Fair Value Through Other Comprehensive Income ( $ 46,941 ) - - - ( 321,990) ( 321,990) ($ 368,931) $ 108,744 - - - 303,058 303,058 ( 85,672) $ 326,130	Stockholders’Equity	Stockholders’Equity
					Legal reserve $ 2,242,269 - - - - - $ 2,242,269 $ 2,381,521 - - - - - - $ 2,381,521	Special reserve $ 2,415,551 - ( 17,173 ) - - - $ 2,398,378 $ 2,571,709 - ( 10,247 ) - - - - $ 2,561,462
						( (	( ( ( (	( ( ( ( (	( ( ( ( (	$ 9,087,874 362,201 ) - 130,320 321,990) 191,670) $ 8,534,003 $ 9,580,533 398,421 ) - 21,160 ) 303,058 281,898 - $ 9,464,010

Subsequent notes are incorporated as part of this individual financial statement.

Chairman: Steve Lee

President: Chao-Feng Chen

Chief Accountant: Pi-Chen Wang

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Taiwan Fire & Marine Insurance Co., Ltd.

STATEMENTS OF CASH FLOWS

From January 1 to March 31, 2021 and 2020

(Reviewed only, not audited based on the GAAS)

Unit: NT$ thousand

Code CASH FLOWS FROM OPERATING ACTIVITIES A00010 Net income (loss) before income tax from continuing operation A20010 Income Charges (Credits) A20100 Depreciation expense A20200 Amortization expenses A21300 Dividends income A20400 Net (gain) loss on financial assets and liabilities at fair value through profit or loss A20900 Interest expense A21200 Interest income A21400 Net changes in insurance liabilities A21830 Reversal gain on expected credit-investment A21850 Impairment loss on non-investment assets A22300 Share of (gain) loss on associates and joint ventures recognized using equity method A22700 Gain on disposal of investment properties A23800 Impairment reversed benefits of reinsurance financial assets A24100 Unrealized gains on foreign currency exchange A29900 Lease Modification Gains A50000 Changes in Operating Assets and Liabilities A51110 Notes receivable increase A51120 Premiums receivable increase A51130 Other accounts receivable decrease (increase) A51140 Increase in financial assets at fair value through profit or loss A51141 Decrease (increase) of financial assets at fair value through other comprehensive income A51160 Decrease (increase) in other financial assets	From January 1 to March 31, 2021 ( $ 47,346 ) 14,651 1,147 ( 275 ) ( 44,631 ) 438 ( 27,007 ) 1,476,431 ( 61 ) 16,526 ( 13,641 ) ( 3,688 ) - ( 3,704 ) ( 4 ) ( 12,099 ) ( 756,114 ) ( 6,227 ) ( 222,040 ) 91,660 123,856	From January 1 to March 31, 2020
		$ 163,723 14,866 728 - 24,471 420 ( 31,096 ) 144,240 ( 67 ) 1,418 5,392 ( 23,723 ) ( 8 ) ( 1,764 ) ( 20 ) ( 2,137 ) ( 92,172 ) 4,556 ( 75,007 ) ( 98,686 ) ( 180,657 )

(To be continued)

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(Continued)

Code A51170 Decrease (increase) in reinsurance contract asset A51990 Increase in other assets A52120 Increase (decrease) in Claims Payable A52140 Increase in commissions payable A52150 Increase in due to reinsurers and ceding companies A52160 Decrease in other payables A52200 Decrease in employees’ benefit liability A52990 Increase (decrease) in Other Liabilities A33000 Cash inflow (outflow) from operations A33100 Interest received A33500 Income tax paid AAAA Net cash inflow (outflow) from operating activities CASH FLOWS FROM INVESTING ACTIVITIES B02700 Payments for property and equipment B03800 Decrease in refundable deposits B04500 Payments for intangible assets B05400 Payments for investment properties B05500 Proceeds from disposal of investment properties BBBB Net cash inflow from investing activities CASH FLOWS FROM FINANCING ACTIVITIES C03000 Increase in guarantee deposits received C03100 Decrease in guarantee deposits received C04020 Repayment of the principal of the lease liabilities CCCC Net cash outflow used in financing activities EEEE Net increase (decrease) in current cash and cash equivalents E00100 CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD E00200 CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	From January 1 to March 31, 2021 $ 65,009 ( 12,562 ) 74 395,173 61,449 ( 92,228 ) ( 1,092 ) ( 8,251) 995,444 16,264 ( 920) 1,010,788 ( 2,540 ) 6,308 ( 1,727 ) - 21,297 23,338 694 - ( 8,208) ( 7,514) 1,026,612 3,684,530 $ 4,711,142	From January 1 to March 31, 2020	From January 1 to March 31, 2020
	( ( ( ( ( ( ( ( (	( ( ( ( ( ( ( ( ( ( ( ( ( ( (	$ 103,954 ) 7,657 ) 3,348 ) 12,387 32,236 83,248 ) 137 ) 3,086 296,158 ) 16,823 870) 280,205) 290 ) 1,638 460 ) 256 ) 90,837 91,469 - 1,064 ) 7,903) 8,967) 197,703 ) 3,415,293 $ 3,217,590

Subsequent notes are incorporated as part of this individual financial statement.

President: Chao-Feng Chen

Chief Accountant: Pi-Chen Wang

Chairman: Steve Lee

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Taiwan Fire & Marine Insurance Co., Ltd.

Notes to Financial Statement

From January 1 to March 31, 2021 and 2020 (Reviewed only, not audited based on the GAAS)

(Expressed in Thousand New Taiwan Dollars unless specified otherwise)

I. Company profile

Taiwan Fire & Marine Insurance Co., Ltd. (“Company”) was established in March 1948 as a non-life insurer. The products offered by the Company include aviation insurance, fire insurance, marine insurance, casualty insurance, automobile insurance, as well as the reinsurances for the abovementioned insurances. The headquarters is located n Taipei, with 10 branches and dozens of service centers throughout Taiwan. At the establishment, the paid-up capital was 10 million Old Taiwanese Dollars. Through several capital increases, as of March 31, 2021, the paid-up capital is NT$ 3,622,004 thousand.

The shares of the Company were approved for the public listing by Securities and Futures Commission, Ministry of Finance on June 11, 1997, and on September 30 of the year started the trading.

The financial statements are presented in NT$, the functional currency of the Company.

II. Date and Procedure for Authorization of Financial Statements

The financial statements were approved by the Board of Directors on April 29, 2021.

III. Applicability of newly promulgated and amended standard rules and interpretations

• (I) The amended Regulations Governing the Preparation of Financial Reports by Insurance Enterprises, as well as International Financial Reporting Standards (“IFRS”), International Accounting Standards (“IAS”), International Financial Reporting Interpretations Committee (“IFRIC”) and Standing Interpretations Committee (“SIC”) Interpretations (collectively “IFRSs”) approved and issued to be effective by the Financial Supervisory Commission, MOF are first time applied.

• The applications of the amended Regulations Governing the Preparation of

• Financial Reports by Insurance Enterprises and IFRSs approved and issued to be effective by FSC will not cause any material changes to the accounting policies of the Company.

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(II) IFRSs issued by IASB but not yet approved and issued to be effective by FSC

Newly Issued/ Amended/ Revised Standards and Interpretations IFRSs “Annual Improvement for the Period of 2018–2020” Amendments to IFRS 3, “Reference to the Conceptual Framework” “Sale or Contribution of Assets between an Investor and its Associate or Joint Venture”, amendments to IFRS 10 and IAS 28. IFRS 17 “Insurance Contracts” Amendments to IFRS 17 Amendments to IAS 1, “Classification of Liabilities as Current or Non-Current” Amendments to IAS 16, “Property, Plant and Equipment: Proceeds before Intended Use” Amendments to IAS 37, “Onerous Contracts — Cost of Fulfilling a Contract” Amendments to IAS 1, “Disclosure of Accounting Polices” Amendments to IAS 8, “Definition of Accounting Estimates”

The effective date promulgated by IASB (Note 1)

January 1, 2022 (Note 2) January 1, 2022 (Note 3) To be determined January 1, 2023 January 1, 2023 January 1, 2023 January 1, 2022 (Note 4) January 1, 2022 (Note 5) January 1, 2023 (Note 6) January 1, 2023 (Note 7)

• Note 1: Unless otherwise expressly remarked, the aforementioned newly promulgated/Amendment/Amended Rules or Interpretation come into effect in the reporting year starting from the specified effective dates.

• Note 2: The amendments to IFRS 9 are applicable to the exchanges of financial liabilities or amendments to terms and conditions incurring during the annual reporting period as of January 1, 2022. The amendments to IAS 41 “Agriculture” are applicable to the measurement of fair value during the annual reporting period as of January 1, 2022. The amendments to IFRS 1 “First-time Adoption of International Financial Reporting Standards (IFRSs)” are applicable retroactively during the annual reporting period as of January 1, 2022.

• Note 3: The amendments are applicable to the merges of enterprises whose annual reporting periods commence as of January 1, 2022.

• Note 4: The amendments are applicable to the plant, property and equipment bringing an asset into the location and condition necessary for it to be

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capable of operating in the manner intended by the management as of January 1, 2021.

• Note 5: The amendments are applicable to the contracts which have not yet fulfilled all obligations therein by January 1, 2022.

• Note 6: The annual reporting period beginning after January 1, 2023 is prospectively applicable to this amendment.

• Note 7: The changes in accounting estimates and accounting policies arising during the annual period beginning after January 1, 2023 are retrospectively applicable to this amendment.

IFRS 17 “Insurance Contracts” and related amendments

IFRS 17 regulates the accounting treatments for insurance contracts, and will replace IFRS 4 “Insurance Contracts.” The major regulations of IFRS 17 and related amendments include the followings:

Level of aggregation of insurance contracts

The Company shall identify portfolios of insurance contracts. A portfolio comprises contracts subject to similar risks and managed together. Contracts within a certain product line would be expected to have similar risks and hence would be expected to be in the same portfolio if they are managed together. The Company shall at least divide the issued insurance portfolios as:

1. A group of contracts that are onerous at initial recognition, if any;

2. A group of contracts that at initial recognition have no significant possibility of becoming onerous subsequently, if any; and

3. A group of the remaining contracts in the portfolio, if any.

The Company shall only divide groups into those including only contracts issued within a year, and shall apply the rules of recognitions and measurements of IFRS 17 to these contracts decided to be issued.

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Recognition

The Company shall recognize a group of insurance contracts it issues from the earliest of the following:

1. The beginning of the coverage period of the group of contracts;

2. The date when the first payment from a policyholder in the group becomes due; and

3. For a group of onerous contracts, when the group becomes onerous.

Measurement of the initial recognitions

On initial recognition, the Company shall measure a group of insurance contracts at the total of the fulfillment cash flows, and the contractual service margin. The fulfillment cash flows comprise estimates of future cash flows, an adjustment to reflect the time value of money and the financial risks related to the future cash flows, and a risk adjustment for non-financial risk. The contractual service margin represents the unearned profit the entity will recognize as it provides services in the future. The Company shall measure the contractual service margin on initial recognition of a group of insurance contracts at an amount that, unless on the group of insurance contracts that are onerous contracts, results in no income or expenses arising from: (1) the initial recognition of an amount for the fulfillment cash flows; (2) all cash flows from the contracts in the group on the same day; (3) the derecognition at the date of initial recognition of the following items: (a) any assets for insurance acquisition cash flows; and (b) any other assets or liabilities previously recognized for the cash flows related to the group of contracts.

Subsequent measuring

The Company shall report the carrying amount of a group of insurance contracts at the end of each reporting period as the sum of the liability for remaining coverage and the liability for incurred claims, comprising the fulfillment cash flows related to past service allocated to the group at that date. The liability for remaining coverage comprises the fulfillment cash flows related to future service and the contractual service margin; the liability for incurred claims, comprising the fulfillment cash flows related to past service. If a group of insurance contracts becomes onerous (or increasingly onerous) when subsequently measured, the losses shall be recognized immediately.

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Onerous contract

An insurance contract is onerous at the date of initial recognition if the fulfillment cash flows allocated to the contract, any previously recognized acquisition cash flows and any cash flows arising from the contract at the date of initial recognition in total are a net cash outflow. The Company shall recognize a loss in profit or loss for the net outflow for the group of onerous contracts immediately, resulting in carrying amount of the liability for the group being equal to the fulfillment cash flows and the contractual service margin of the group being zero. Before reversing the recognized amount of loss, no contractual service margin occurs, and no income from insurance contracts is recognized.

Premium Allocation Approach

The Company may simplify the measurement of a group of insurance contracts using the premium allocation approach if, and only if, at the inception of the group, alternatively:

1. The Company reasonably expects that such simplification would produce a measurement of the liability measured for remaining coverage for the group that would not differ materially from the one that would be produced; or

2. The coverage period of each contract in the group is one year or less.

The criterion in said (1) paragraph is not met if at the inception of the group an entity expects significant variability in the fulfillment cash flows that would affect the measurement of the liability for remaining coverage during the period before a claim is incurred.

Using the premium allocation approach, the liability for remaining coverage on initial recognition:

1. is the premium received at initial recognition;

2. minus any insurance acquisition cash flows on the same day; and

3. plus or minus the derecognition at the date of initial recognition of the following items:

4. (1) all insurance acquisition cash flow assets; and

5. (2) any other assets or liabilities previously recognized for the cash flows related to the group of contracts.

Subsequently, the liability for remaining coverage will adjust amount of the premiums received in the period plus the amortization of insurance acquisition cash

• 15 -

flows, and minus the amount recognized as insurance revenue for services provided, as well as all investment component paid or transferred to the liability for incurred claims.

Discretionary Participation Feature Investment Contract

The discretionary participation feature investment contract refers to the financial instrument free from transfer of significant insurance risk. If the Company issues the discretionary participation feature investment contract and also insurance contract at the same time, such contract shall apply IFRS 17.

Modification and derecognition

If the terms of an insurance contract are modified, and meet the certain conditions are met as substantial modification, the Company shall derecognized the original contract and recognize the modified contract as a new contract.

An entity shall recognized an insurance contract when, and only when it is extinguished or substantially modified.

Transitional Regulations

As a principle, the Company shall fully apply IFRS 17 retrospectively. However, if this is not practical, the Company may opt to apply the modified retrospective or fair value approach.

The modified retrospective approach refers to that the Company shall achieve the closest outcome to fully retrospective application possible using reasonable and supportable information available without undue cost or effort. If the reasonable and supportable information is not able to be obtained, it shall apply the fair value approach.

By applying the fair value approach, the Company determines the contractual service margin at the transition date as the difference between the fair value of a group of insurance contracts at that date and the fulfillment cash flows measured at that date.

Except the abovementioned effects, as of the issuing date of the Financial Statement, the Company has been evaluating the effects to the financial positions and performance from the amendments of other standards and interpretations, and these related effects are to be disclosed when such evaluations are completed.

• 16 -

IV. Summary of significant accounting policies

(I) Declaration in compliance

The financial statements are prepared according to the Regulations Governing the Preparation of Financial Reports by Insurance Enterprises and IAS 34 “Interim Financial Reporting” approved by FSC. This financial report does not include all the IFRS disclosures required by the annual financial statement.

• (II) Principles for preparation

The financial statements have been prepared on the historical cost basis except for financial instruments at fair value and net defined benefit liabilities at the present value of defined obligation less fair value of the plan assets.

Fair value measurement may be divided into three levels based on the observability and importance of related inputs:

1. Level 1 inputs: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

2. Level 2 inputs: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (from price) or indirectly (induced from price).

3. Level 3 inputs: Unobservable inputs for the asset or liability.

4. (III) Other Material Accounting Policies

Other than the following notes, please refer to the aggregated descriptions of the material accounting policies in the 2020 Annual Financial Report

1. Defined post-employment benefits

The interim pension costs applies the pension cost rate determined via actuarial on the end date of the previous year, and are calculated based on the period from the beginning of the year to the end of the period. The adjustments will be made for the material movement of the market during the period, major plan revision, repayment, or other material one-time matters.

1. Income Tax

The term “income tax expenses” as set forth herein denotes total of the income tax payable in the current term and the deferred income tax. The interim income tax is evaluated based on the year; the tax rate applicable to the expected total annual earning is applied to calculate the interim pre-tax incomes.

• 17 -

V. Major sources of major accounting judgments, estimate and hypotheses

Please refer to the material accounting judgement, estimates, and the major sources

of uncertainties for the estimates specified in the 2020 Annual Financial Report.

VI. Cash and cash equivalents

Cash and cash equivalents
Cash on hand and working capital Bank’s notes and current deposit Cash Equivalents Commercial paper Time deposits in banks due within 3 months in the date of initial maturity Less: Deductible of Refundable Deposits (Note 16)	March 31, 2021 $ 33,102 3,420,531 999,086 334,700 ( 76,277) $ 4,711,142	December 31, 2020 $ 31,015 2,352,720 1,048,190 340,190 ( 87,585) $ 3,684,530	March 31, 2020
	(	(	(	$ 31,253 2,650,963 349,558 258,590 72,774) $ 3,217,590

The market interest rate ranges of bank time deposits and commercial paper on the balance sheet date are as follows:

Time deposits in banks due within 3 months in the date of initial maturity Commercial paper	March 31, 2021 0.06%~0.41% 0.16%~0.19%	December 31, 2020 0.06%~0.41% 0.18%~0.23%	March 31, 2020
			0.09%~0.66% 0.38%~0.49%

VII. Receivables

December 31,

Notes receivable Less: allowance loss Premiums receivable Premiums receivable - Non-accrual loan Less: allowance loss Interest receivable Other receivable Other receivable - Non-accrual loan Less: allowance loss Other receivables	March 31, 2021 $ 109,178 ( 1,092) $ 108,086 $ 1,195,563 57,842 ( 29,861) $ 1,223,544 $ 69,066 17,950 21,051 ( 7,647) $ 100,420		2020 $ 97,079 971) $ 96,108 $ 469,941 25,653 10,231) $ 485,363 $ 58,323 13,133 19,366 6,833) $ 83,989	March 31, 2020	March 31, 2020
	( ( (	( ( (		( ( (	$ 124,145 1,241) $ 122,904 $ 456,671 46,455 11,078) $ 492,048 $ 69,234 28,425 5,503 996) $ 102,166

• 18 -

(I) Receivables

To reduce the credit risks, the management of the Company has assigned the premium section to track the overdue payment, to ensure the proper actions have been taken for the recovery of overdue receivables. Besides, on the balance sheet dates, the Company review the recoverable amount of the receivables again one by one, to ensure the unrecoverable receivables are provided for the proper allowance loss. Therefore, the management of the Company believes the credit risks of the Company is significantly reduced.

The Company recognizes the allowance loss for receivables as the higher expected credit losses between from of the “Regulations Governing the Procedures for Insurance Enterprises to Evaluate Assets and Deal with Non-performing / Non-accrual Loans” and simplified method of IFRS 9, or of the lifetime. The lifetime expected credit losses are calculated using the reserve matrix, by considering the past default records and the current financial position of clients, industrial economic situations, as well as the GDP forecast and industrial outlooks. As the credit loss history of the Company shows that there is no significant difference among the loss patterns of different client groups, the reserve matrix does not further divide the client groups, but only establish the expected credit losses based on the aging of receivables.

Where any evidence shows that the counterparties of transactions have severe financial difficulties, and the Company cannot reasonably expect the recoverable amount, e.g. the counterparty is being liquidated, the Company writes off the related receivables upon the resolution passed by the Board of Directors. However the pursuit of recovery will be continued, and the amount recovered from such pursuit will be recognized in profit/loss.

The Company recognizes the allowance loss for receivables as the higher expected credit losses between the “Regulations Governing the Procedures for Insurance Enterprises to Evaluate Assets and Deal with Non-performing/Non-accrual Loans,” or from the reserve matrix. The movement for the allowance loss for the receivables during January 1 to March 31, 2021 and 2020 are as follows:

• 19 -

March 31, 2021

March 31, 2021
Balance - beginning Add: Provision of the period Balance - ending		12-month expected creditlossI $ 853 9,344 $ 10,197	Lifetime expected creditlossII $ 1,214 1,600 $ 2,814	Lifetime expected creditlossIII $ 520 2,411 $ 2,931	Impairment provided based in IFRS 9 $ 2,587 13,355 $ 15,942	Impairment based on the “Regulations Governing the Procedures for Insurance Enterprises to Evaluate Assets and Deal with Non-performi ng/Non-accru al Loans” $ 15,448 7,210 $ 22,658		Total
								$ 18,035 20,565 $ 38,600

March 31, 2020

March 31, 2020
Balance - beginning Add: Provision (reversal) in the period Balance - ending		12-month expected creditlossI $ 3,195 1,346) $ 1,849	Lifetime expected creditlossII $ 2,735 ( 331) $ 2,404	Lifetime expected creditlossIII $ 825 29 $ 854	Impairment provided based in IFRS 9 $ 6,755 ( 1,648) $ 5,107	Impairment based on the “Regulations Governing the Procedures for Insurance Enterprises to Evaluate Assets and Deal with Non-performi ng/Non-accru al Loans” $ 5,480 2,728 $ 8,208		Total
	(		(		(			$ 12,235 1,080 $ 13,315

The allowance for loss as of March 31, 2021 and 2020 increased by NT$20,565

thousand and NT$1,080 thousand, respectively, mainly as a result of the net increase of NT$757,811 thousand in the gross carrying value of the receivable premium in the accounts receivable on March 31, 2021 and net increase of NT$13,491 thousand in the gross carrying value of receivables transferred to the non-accrual loans on March 31, 2020.

(II) Non-accrual loan and allowance for loss

For the notes receivable, premium receivable, and non-accrual loans in other receivables, the allowances have been provided as NT$0 thousand, NT$8,517 thousand, and NT$6,900 thousand, respectively, as of March 31, 2021.

For the notes receivable, premium receivable, and non-accrual loans in other receivables, the allowances have been provided as NT$0 thousand, NT$6,215 thousand, and NT$6,693 thousand, respectively, as of December 31, 2020.

• 20 -

For the notes receivable, premium receivable, and non-accrual loans in other receivables, the allowances have been provided as NT$0 thousand, NT$6,580 thousand, and NT$860 thousand, respectively, as of March 31, 2020.

(III) The ageing analysis for the receivables

0 - 30 days 31 - 90 days 91 - 180 days 181 - 365 days More than 365 days Total	March 31, 2021 $ 430,860 960,909 60,086 3,763 15,032 $ 1,470,650	December 31, 2020 $ 639,660 19,574 7,283 7,717 9,261 $ 683,495	March 31, 2020	March 31, 2020
				$ 545,873 132,613 48,060 3,033 854 $ 730,433

The aging analysis is conducted based on the accounted dates.

VIII. Financial instruments measured at fair values through profit and/or loss

VIII. Financial instruments measured at fair values through profit and/or los	s	s
March 31, 2021 December 31, 2020 Held for transaction purposes - TWSE/GTSM listed shares $ 249,079 $ 204,920 - Beneficiary certificates of funds 280,357 156,780 Compulsory measurement at fair value through profit and loss - Domestic financial bonds 1,154,223 1,054,592 - Domestic corporate bonds 521,701 522,397 $ 2,205,360 $ 1,938,689 IX. Financial assets at fair value through other comprehensive income March 31, 2021 December 31, 2020 Equity instruments at fair value through other comprehensive income $ 3,984,549 $ 3,668,717 Bond instruments measured at fair value through other comprehensive income 1,509,556 1,612,245 Deductible of refundable deposits ( 614,935) ( 622,187) $ 4,879,170 $ 4,658,775	March 31, 2020
	$ 321,069 76,719 886,967 531,133 $ 1,815,888 March 31, 2020
	(	$ 3,005,724 1,778,617 616,589) $ 4,167,752

• 21 -

(I) Investments in equity instruments

Domestic investment TWSE/TPEx-listed shares and emerging shares Unlisted Shares	March 31, 2021 $ 3,599,671 384,878 $ 3,984,549	December 31, 2020 $ 3,310,661 358,056 $ 3,668,717	March 31, 2020	March 31, 2020
				$ 2,626,043 379,681 $ 3,005,724

The Company invests for the mid- and long-term strategies, and expects to gain through the long-term investments. The management of the Company believes that it is inconsistent to include the short-term fair value fluctuations of such investments in profit/loss for the said purpose of long-term investments; therefore, it opts to designate such investments as measured at FVTOCI.

During January 1 to March 31, 2021, the Company adjusted the investment positions to diversify risks, and the sold part of common shares at fair value for NT$256,837 thousand; the related other equity - unrealized valuation gain and losses on financial assets at fair value through other comprehensive income, NT$85,672 thousand has been transferred to the retained earnings.

The Company recognized the dividend revenue NT$275 thousand from January 1 to March 31, 2021. The amount related to the holders was NT$275 thousand on March 31, 2021.

(II) Investments in liability instruments

Domestic investment Government Bonds Financial bonds Corporate bonds Deductible of Refundable Deposits (Note 16) Subtotal Foreign investment Financial bonds Corporate bonds Subtotal Total	March 31, 2021 $ 614,935 49,998 103,964 ( 614,935) 153,962 $ 142,507 598,152 740,659 $ 894,621	December 31, 2020 $ 622,187 49,998 104,110 ( 622,187) 154,108 $ 142,258 693,692 835,950 $ 990,058	March 31, 2020	March 31, 2020
	(	(	(	$ 616,589 150,166 104,552 616,589) 254,718 $ 151,000 756,310 907,310 $ 1,162,028

• 22 -

For the information for credit risks management and the impairment evaluation

related to bond instruments measured at fair value through other comprehensive income, please refer to Note 10.

X. Credit risks management for Investments in liability instruments

Bond instruments investment accounted as financial assets at fair value through other comprehensive income:

March 31, 2021

Total of Carrying Amount Allowance loss Amortized cost Adjustment to fair value Deductible of refundable deposits

At fair value through other comprehensive income $ 1,431,404 ( 823 ) 1,430,581 78,975 1,509,556 ( 614,935 ) $ 894,621

December 31, 2020

At fair value through other comprehensive income Total of Carrying Amount $ 1,517,360 Allowance loss ( 884 ) Amortized cost 1,516,476 Adjustment to fair value 95,769 1,612,245 Deductible of refundable deposits ( 622,187 ) $ 990,058

March 31, 2020

March 31, 2020
Total of Carrying Amount Allowance loss Amortized cost Adjustment to fair value Deductible of refundable deposits	At fair value through other comprehensive income
	( (	$ 1,717,271 1,195) 1,716,076 62,541 1,778,617 616,589) $ 1,162,028

The policies applied by the Company is to only invest the bond instruments with rating of investment grade and above (including) and low credit risk for impairment evaluation. The credit ratings are provided by independent rating agencies. The Company continuously track the external ratings to monitor the movement of the credit

• 23 -

risk for the invested bond instruments, while reviewing other information such as the yield curves of bonds and material information of the debtors, for the purpose of evaluating if the credit risks of bond instruments increase significantly since the initial recognition.

By considering the default loss rate provided by the external rating agencies, current financial position of the debtors, and the outlook forecasts of the industries where they operates, to measure the 12-month ECLs or lifetime ECLs. The current credit risk rating mechanism of the Company is as the following:

Credit rating Normal Abnormal Default Write Off	Definition The credit risk of the debtor is low, or not increased significantly, with sufficient solvency for the contractual cash flow The credit risk has been significantly increased since initial recognition Evidence of credit loss exists or the credit impairment loss is recognized The available proof showed that the debtor was suffering serious financial difficulties and it was impossible for the Company to expect recoverability	Basis for Recognizing ECLs
		12-month expected credit loss Lifetime expected credit loss (credit not impaired) Lifetime expected credit loss (credit impaired) Direct Write Off

The total book values of the debt instrument investments of each credit rating, and the applicable ECL rates are as the following:

March 31, 2021

March 31, 2021
Credit rating Normal Abnormal Default Write Off	Expected Credit Loss (ECL) 0.0251%~0.4997% (Note) (Note) (Note)	March 31, 2021 Total of Carrying Amount
		$ 1,431,404 - - -

December 31, 2020

December 31, 2020
Credit rating Normal Abnormal Default Write Off	Expected Credit Loss (ECL) 0.002%~0.519% (Note) (Note) (Note)	December 31, 2020 Total of Carrying Amount
		$ 1,517,360 - - -

• 24 -

March 31, 2020

March 31, 2020
Credit rating Normal Abnormal Default Write Off	Expected Credit Loss (ECL) 0.002%~0.8996% (Note) (Note) (Note)	March 31, 2020 Total of Carrying Amount
		$ 1,717,271 - - -

(Note): The credit level of the bond investments as of March 31, 2021, and December 31 and March 31, 2020 were all normal and thus not applicable.

For the bond instruments measured at fair value through other comprehensive income, the movement for allowance loss is summarized by the grade of credit risks as the following:

	the following:
XI.	Credit rating Normal (12-month expected credit loss) Abnormal (Lifetime expected credit loss whose credit not impaired) Default (Lifetime expected credit loss exists and the credit is impaired) Balance at January 1, 2021 $ 884 $ - $ - Derecognition ( 13) - - Exchange rate and other movement ( 48) - - Balance at March 31, 2021 $ 823 $ - $ - Balance at January 1, 2020 $ 1,262 $ - $ - Exchange rate and other movement ( 67) - - Balance at March 31, 2020 $ 1,195 $ - $ - Investment under equity method March 31, 2021 December 31, 2020 March 31, 2020 Investments in associates $ 256,126 $ 242,485 $ 212,547 Summarization About Associates With Immateriality Information Percentage of the shareholding and voting rights Company Name March31,2021 December 31, 2020 March31,2020 Top Taiwan X Venture Capital Co., Ltd. 24.75% 24.75% 24.75%		Credit rating
				Default (Lifetime expected credit loss exists and the credit is impaired)
				$ - - - $ - $ - - $ - March 31, 2020
	Company Name Top Taiwan X Venture Capital Co., Ltd.
		March31,2021 24.75%	December 31, 2020 24.75%	March31,2020
				24.75%

• 25 -

Shares Vested in the Company Net profit for the period from continuing operations Other Comprehensive Income Total Comprehensive Income	From January 1 to March 31, 2021 $ 13,641 - $ 13,641	From January 1 to March 31, 2020
		($ 5,392) - ($ 5,392)

For the business natures, major business locations, and the countries where the entities register, please refer to the Table 1: “Information, Location of the Invested Company”.

XII. Other financial assets - net

Other financial assets-net	Other financial assets-net
Time deposit with initial maturity date more than three months away Less: Deductible of Refundable Deposits (Note 16) Investment Properties Investment Properties Completed Right-of-use assets Cost Balance at January 1, 2020 Increase Disposition ( Transferred to Property and equipment ( Balance at March 31, 2020		March 31, 2021 December 31, 2020 $ 2,869,096 $ 2,987,652 ( 23,145) ( 18,145) $ 2,845,951 $ 2,969,507 March 31, 2021 December 31, 2020 $ 2,137,377 $ 2,265,866 19,394 20,891 $ 2,156,771 $ 2,286,757 Land House and building Right-of-use assets $ 2,120,730 $ 509,617 $ 32,861 - 256 - 42,078 ) ( 27,642 ) - 28,735) ( 10,599) - $ 2,049,917 $ 471,632 $ 32,861			March 31, 2020
					$ 3,174,952 ( 40,645) $ 3,134,307 March 31, 2020
						$	2,284,412 25,379 2,309,791 Total
						$
	( (			$ 32,861 - - -		( (	$ 2,663,208 256 69,720 ) 39,334) $ 2,554,410
				$ 32,861

XIII. Investment Properties

(To be continued)

• 26 -

(Continued)

ed)
Accumulated depreciation and impairment Balance at January 1, 2020 Depreciation expense Disposition Transferred to Property and equipment Balance at March 31, 2020 Net at March 31, 2020 Cost Balance at January 1, 2021 Disposition Transferred to Property and equipment Balance at March 31, 2021 Accumulated depreciation and impairment Balance at January 1, 2021 Depreciation expense Disposition Transferred to Property and equipment Balance at March 31, 2021 Net at March 31, 2021		Land $ - - - - $ - $ 2,049,917 $ 2,061,650 7,377 ) 73,560) $ 1,980,713 $ - - - - $ - $ 1,980,713		House and building $ 243,245 3,384 2,606 ) 6,886) $ 237,137 $ 234,495 $ 455,752 11,523 ) 38,217) $ 406,012 $ 251,536 3,325 1,291 ) 4,222) $ 249,348 $ 156,664		Right-of-use assets $ 5,985 1,497 - - $ 7,482 $ 25,379 $ 32,861 - - $ 32,861 $ 11,970 1,497 - - $ 13,467 $ 19,394		Total
	( (		( ( ( ( ( (				( ( ( ( ( (	$ 249,230 4,881 2,606 ) 6,886) $ 244,619 $ 2,309,791 $ 2,550,263 18,900 ) 111,777) $ 2,419,586 $ 263,506 4,822 1,291 ) 4,222) $ 262,815 $ 2,156,771

The Company amortized depreciation on the straight-line basis for its investment properties of the following useful life:

House and building Right-of-use assets

55-60 years 5-15 years

Considering that the COVID-19 epidemic severely affected the market economy in 2020, the Company agreed that certain lease contracts may cut rent by 20% from March to May 2020, and by 10% from August to October 2020, i.e. by NT$4,615 thousand in total.

The fair value of the investment properties as of December 31, 2020 and 2019 were NT$4,586,157 thousand and NT$4,597,915 thousand (exclusive of right-of-use assets). The fair value was measured at the level 3 inputs at each balance sheet date by the independent appraising companies, Affluence Real Estate Appraiser Firm and Y.C.R.E., respectively. The appraisal was evaluated based on the “Regulations on Real Estate Appraisal,” by applying appraisal approaches including market comparison,

• 27 -

income, analysis of land development, or cost. The applied key unobservable input is the discount rate, namely 0.82%~5.00% and 0.83%~6.00%. Upon evaluation by the Company's management, the fair values substantially remained unchanged on March 31, 2021 and 2020.

On May 21, 2010, the Company entered a co-building contract with Jut Land Development Co., Ltd. (“Jut Land Development”), to jointly build a building at Sub-section No. 1, Zhongshan Section, Zhongshan District, Taipei City. The approach of the project is co-construction for sharing building. The Company provided the land, and Jut Land Development provided fund for construction. The area of each levels and the parking lot are shared by Jut Land Development and the Company for 35% and 65%, respectively. According to the co-building contract, Jut Land Development should pay the deposit of NT$50,000 thousand to the Company (stated as deposits received) when signing the contract, with a note bond with carrying amount of NT$50,000 thousand. The Company shall return the said bond and note bond to Jut Land Development upon building delivery. On May 6, 2016, the Company signed a complementary agreement with Jut Land Development. On the signing date, the deposit of NT$50,000 thousand was returned. The last unit at A1-7F of the co-building project has been surrendered to the client on April 14, 2020. Therefore, on May 25, 2020, the note bond with carrying amount of NT$50,000 thousand was refunded to Jut Land Development.

The land provided by the Company was transferred on December 27, 2014, and the building started to be sold when the title of the building was obtained on January 27, 2015.

From January 1 to March 31, 2021, the Company disposed of the investment property including the land and buildings at Section 5, Roosevelt Rd., Taipei City, and the land at Sub-section No. 3, Xinglong Section, Wenshan District, Taipei City, generated the proceeds totaling NT$21,297 thousand (after tax). Less the book value, NT$17,609 thousand, the gains from the disposal became NT$3,688 thousand, stated as the operating revenue-gain (loss) on investment properties.

From January 1 to March 31, 2020, the Company disposed of the investment properties including the land and buildings at Sub-section No. 1, Zhongshan Section, Zhongshan District, Taipei City, and generated the proceeds totaling NT$79,274 thousand (after tax). Less the book value, NT$56,583 thousand, the gains from the disposal became NT$22,691 thousand, stated as the operating revenue-gain (loss) on investment properties.

• 28 -

From January 1 to March 31, 2020, the Company disposed of the investment property including the land and buildings at Section 5, Roosevelt Rd., Taipei City, and the land at Sub-section No. 3, Xinglong Section, Wenshan District, Taipei City, generated the proceeds totaling NT$11,563 thousand (after tax). Less the book value, NT$10,531 thousand, the gains from the disposal became NT$1,032 thousand, stated as the operating revenue-gain (loss) on investment properties.

On March 31, 2021, the total amounts of the expected future lease payments from the investment oriented real estate leased as operating leases are as the following:

1st year 2nd year 3rd year 4th year 5th year More than 5 years	March 31, 2021 $ 114,718 89,914 62,939 47,538 12,518 1,753 $ 329,380	December 31, 2020 $ 109,829 87,388 56,701 42,640 10,460 2,659 $ 309,677	March 31, 2020	March 31, 2020
				$ 102,007 91,997 64,704 39,598 27,575 5,376 $ 331,257

XIV. Property and equipment

Cost Balance at January 1, 2020 Increase Disposition Transferred from Investment Properties Balance at March 31, 2020 Accumulated depreciation and impairment Balance at January 1, 2020 Depreciation expense Disposition Transferred from Investment Properties Balance at March 31, 2020 Net at March 31, 2020 Cost Balance at January 1, 2021 Increase Transferred from Investment Properties Balance at March 31, 2021 Accumulated depreciation and impairment Balance at January 1, 2021 Depreciation expense Transferred from Investment Properties Balance at March 31, 2021 Net at March 31, 2021		Own land	Buildings and ancillary equipment	Buildings and ancillary equipment		Computer equipment		Traffic and transport equipment		Other equipment	Leasehold improvement s	Leasehold improvement s		Total
		$ 261,774 - - 28,735 $ 290,509 $ - - - - $ - $ 290,509 $ 261,774 - 73,560 $ 335,334 $ - - - $ - $ 335,334		$ 164,730 - - 10,599 $ 175,329 $ 94,056 859 - 6,886 $ 101,801 $ 73,528 $ 166,942 - 38,217 $ 205,159 $ 97,354 916 4,222 $ 102,492 $ 102,667		$ 30,688 290 - - $ 30,978 $ 15,738 1,528 - - $ 17,266 $ 13,712 $ 29,874 1,422 - $ 31,296 $ 14,938 1,541 - $ 16,479 $ 14,817		$ 8,949 - - - $ 8,949 $ 5,307 290 - - $ 5,597 $ 3,352 $ 8,537 267 - $ 8,804 $ 5,891 287 - $ 6,178 $ 2,626		$ 10,839 - - - $ 10,839 $ 6,142 421 - - $ 6,563 $ 4,276 $ 8,970 293 - $ 9,263 $ 4,700 332 - $ 5,032 $ 4,231		$ 10,889 - - - $ 10,889 $ 6,237 657 - - $ 6,894 $ 3,995 $ 7,726 558 - $ 8,284 $ 4,534 516 - $ 5,050 $ 3,234		$ 487,869 290 - 39,334 $ 527,493 $ 127,480 3,755 - 6,886 $ 138,121 $ 389,372 $ 483,823 2,540 111,777 $ 598,140 $ 127,417 3,592 4,222 $ 135,231 $ 462,909

• 29 -

The depreciation expenses are provided on the straight-line basis during the durable life span:

span:
Building	30-35 and 55 years
Auxiliary equipment
Power transmission equipment	15-20 years
Telecommunication equipment	8-10 and 15 years
Fire-fighting equipment	10 years
Computer equipment	3-6 years
Traffic and transport equipment	3-5 years
Other equipment	4-8 years
Leasehold improvements	4 years

XV. Lease Agreement

(I) Right-of-use assets

Right-of-use assets
Cost Balance at January 1, 2020 Increase Decrease in the period Balance at March 31, 2020 Accumulated depreciation and impairment Balance at January 1, 2020 Depreciation expense Decrease in the period Balance at March 31, 2020 Net at March 31, 2020 Cost Balance at January 1, 2021 Increase Decrease in the period Balance at March 31, 2021 Accumulated depreciation and impairment Balance at January 1, 2021 Depreciation expense Decrease in the period Balance at March 31, 2021 Net at March 31, 2021		Land $ - - - $ - $ - - - $ - $ - $ - - - $ - $ - - - $ - $ -		Building $ 50,762 3,368 1,565) $ 52,565 $ 20,550 5,606 1,457) $ 24,699 $ 27,866 $ 69,820 3,588 3,897) $ 69,511 $ 27,171 5,509 3,610) $ 29,070 $ 40,441		Transport equipment $ 8,074 - 3,005) $ 5,069 $ 4,154 624 2,791) $ 1,987 $ 3,082 $ 7,052 - - $ 7,052 $ 3,950 728 - $ 4,678 $ 2,374		Total
			( ( ( (		( (		( ( ( (	$ 58,836 3,368 4,570) $ 57,634 $ 24,704 6,230 4,248) $ 26,686 $ 30,948 $ 76,872 3,588 3,897) $ 76,563 $ 31,121 6,237 3,610) $ 33,748 $ 42,815

The land rented by the Company was subleased in the form of operating lease. The relevant right-of-use assets were stated as the investment properties. Please refer to Note 13. Said right-of-use assets excluded those defined as investment properties.

• 30 -

(II) Lease liabilities

Lease liabilities
Face values of lease liabilities Interest expense of lease liabilities	March 31, 2021 December 31, 2020 $ 67,025 $ 71,498 From January 1 to March 31, 2021 $ 438			December 31, 2020	March 31, 2020 $ 62,188 From January 1 to March 31, 2020	March 31, 2020
							$ 420

Discount rates for the lease liabilities are as the following:

Land Building Transport equipment	March 31, 2021 2.616% 2.366%~2.616% 2.366%~2.616%	December 31, 2020 2.616% 2.366%~2.616% 2.366%~2.616%	March 31, 2020
			2.616% 2.616% 2.616%

• (III) Major lessee activities and terms and conditions

When the Company is a lessee of lands and buildings, the period is 1 to 5 years. When the lease period expires, the Company has no favorable right to purchase the leased lands.

• (IV) Other information of Leases

) Other information of Leases	) Other information of Leases	) Other information of Leases
From January 1 to March 31, 2021 Short-term lease expenses $ 1 Low-valued asset lease expenses $ 234 Total amount of cash (outflow) of lease ($ 8,208) Refundable deposit March 31, 2021 December 31, 2020 Refundable deposit Bond of Insurance Enterprises $ 614,935 $ 622,187 Bond of Litigation 18,377 18,377 Others 81,045 87,353 $ 714,357 $ 727,917			From January 1 to March 31, 2020
				$ 35 $ 4 ($ 7,903) March 31, 2020
		$ 622,187 18,377 87,353 $ 727,917			$ 616,589 3,337 110,082 $ 730,008

XVI. Refundable deposit

• 31 -

• (I) Based on Article 141 and 142 of the Insurance Act, an insurance enterprise shall post bond at the national treasury in an amount equal to 15% of the total amount of its paid-in capital or paid-in fund. The bond posted is not to be returned except suspending business and having liquidation completed. The Company offset it with the government bonds.

• (II) The Company has furnished the following assets to secure legal actions and others on March 31, 2021, and December 31 and March 31, 2020, respectively.

Other financial assets - Time deposits Cash and cash equivalents	March 31, 2021 $ 23,145 76,277 $ 99,422	December 31, 2020 $ 18,145 87,585 $ 105,730	March 31, 2020	March 31, 2020
				$ 40,645 72,774 $ 113,419

XVII. Reserve for liabilities

Reserve for liabilities
Net defined benefit liability	March 31, 2021 $ 81,286	December 31, 2020 $ 82,378	March 31, 2020
			$ 83,990

The pension expense related to the defined benefit program are calculated at the pension cost rate determined via actuarial on December 31 of 2020 and 2019, and recognized into the following titles in respective periods:

Operating Expenses	From January 1 to March 31, 2021 $ 476	From January 1 to March 31, 2020	From January 1 to March 31, 2020
			$ 542

XVIII. Reinsurance contract asset and Insurance liabilities

Less benefits & claims recovered from reinsurers Less: allowance loss Due from reinsurers and ceding companies Due from reinsurers and ceding companies - Non-accrual loan Less: allowance loss	March 31, 2021 $ 1,420 ( 7) $ 1,413 $ 132,282 8,453 ( 10,929) $ 129,806		December 31, 2020 $ 21,187 106) $ 21,081 $ 174,240 11,734 14,958) $ 171,016	March 31, 2020	March 31, 2020
	( (	( (		( (	$ 73,794 369) $ 73,425 $ 171,036 5,908 11,865) $ 165,079

(To be continued)

• 32 -

(Continued)

ed)
Reinsurance reserve asset - net Ceding unearned premium reserves Ceding claims reserves Less: Accumulated impairment Insurance liabilities Unearned premium reserves Claim reserves Special reserves Premium deficiency reserves	March 31, 2021 $ 916,088 968,636 ( 314) $ 1,884,410 $ 4,913,537 3,053,069 2,128,957 6,437 $ 10,102,000		December 31, 2020 $ 802,184 925,404 314) $ 1,727,274 $ 3,447,801 2,894,345 2,118,699 7,588 $ 8,468,433	March 31, 2020
	(	(		(	$ 854,867 933,661 4,279) $ 1,784,249 $ 3,418,920 2,832,624 2,138,668 7,333 $ 8,397,545

(I) Less benefits & claims recovered from reinsurers

Upon determination of the recoverability of claim recoverable from reinsurers, the Company took into account and all changes in the quality of credit of the claim recoverable from reinsurers during the period starting from the initial granting of the loan until the balance sheet date. The Company provides the allowance for loss based on the “Regulations Governing the Procedures for Insurance Enterprises to Evaluate Assets and Deal with Non-performing/Non-accrual Loans,” and all the claims that are overdue for nine months and recoverable from reinsurers are transferred to the non-accrued loans.

This is the current payment resulted from ceding reinsurance business among insurer’s peer, and thus the concentration of the credit risk is limited.

(II) Due from reinsurers and ceding companies

Upon determination of the recoverability of due from reinsurers and ceding companies, the Company took into account and all changes in the quality of credit of the due from reinsurers during the period starting from the initial granting of the loan until the balance sheet date. The Company provides the allowance for loss based on the “Regulations Governing the Procedures for Insurance Enterprises to Evaluate Assets and Deal with Non-performing/Non-accrual Loans,” and all the due from reinsurers overdue for nine months are transferred to the non-accrued loans.

• 33 -

This is the current payment resulted from ceding and inward reinsurance business among insurer’s peer, and thus the concentration of the credit risk is limited.

(III) Movement of allowance for loss for Claim recoverable from reinsurers and due from reinsurers and ceding companies are as follows:

Balance at January 1, 2020 Add: Provision (reversal) in the current period Balance at march 31, 2020 Balance at January 1, 2021 Add: Reversal in the current period Balance at March 31, 2021	Impairment loss by individual assessment $ 7,928 ( 887) $ 7,041 $ 11,211 ( 4,083) $ 7,128	Impairment loss by group assessment $ 3,968 1,225 $ 5,193 $ 3,853 ( 45) $ 3,808		Total
	( (	(	(	$ 11,896 338 $ 12,234 $ 15,064 4,128) $ 10,936

The Company does not hold any collateral for the outstanding balances of such receivables.

• (IV) Allowance for loss of the non-accrual loan

As of March 31, 2021, the impairment or unrecoverable amount has been evaluated for the due from reinsurers and ceding companies, and the allowance for loss has been provided as NT$7,128 thousand.

As of December 31, 2020, the impairment or unrecoverable amount has been evaluated for the due from reinsurers and ceding companies, and the allowance for loss has been provided as NT$11,211 thousand.

As of March 31, 2020, the impairment or unrecoverable amount has been evaluated for the due from reinsurers and ceding companies, and the allowance for loss has been provided as NT$7,041 thousand.

• 34 -

(V) Reinsurance reserve asset and Insurance liabilities

Movement of increase/decrease for reinsurance reserve assets and insurance

liabilities during January 1 to March 31, 2021:

Reinsurance reserve asset-net Ceding unearned premium reserves Total amount Recognized impairment loss Ceding claims reserves Reported but not yet paid Not yet reported Recognized impairment loss Total of Reinsurance reserve asset Insurance liabilities Unearned premium reserves Claim reserves Reported but not yet paid Not yet reported Special reserves Special reserves for material accidents Special reserves for hazard changes Other special reserves Premium deficiency reserves Total insurance liabilities		January 1, 2021 $ 802,184 - 802,184 557,847 367,557 314) 925,090 $1,727,274 $3,447,801 1,858,918 1,035,427 2,894,345 178,008 796,548 1,144,143 2,118,699 7,588 $8,468,433	Provision of thePeriod $ 530,550 - 530,550 608,482 360,154 - 968,636 $1,499,186 $3,127,351 1,987,471 1,065,598 3,053,069 - - 16,763 16,763 6,437 $6,203,620	Recovery of thePeriod $ 416,646 - 416,646 557,847 367,557 - 925,404 $1,342,050 $1,661,615 1,858,918 1,035,427 2,894,345 2,024 - 4,481 6,505 7,588 $4,570,053		Others $ - - - - - - - $ - $ - - - - - - - - - $ -		March 31, 2021
	(						$ 916,088 - 916,088 608,482 360,154 ( 314) 968,322 $1,884,410 $4,913,537 1,987,471 1,065,598 3,053,069 175,984 796,548 1,156,425 2,128,957 6,437 $ 10,102,000

• 35 -

Movement of increase/decrease for reinsurance reserve assets and insurance liabilities during January 1 to March 31, 2020:

Reinsurance reserve asset-net Ceding unearned premium reserves Total amount Recognized impairment loss Ceding claims reserves Reported but not yet paid Not yet reported Recognized impairment loss Total of Reinsurance reserve asset Insurance liabilities Unearned premium reserves Claim reserves Reported but not yet paid Not yet reported Special reserves Special reserves for material accidents Special reserves for hazard changes Other special reserves Premium deficiency reserves Total insurance liabilities		January 1, 2020 $ 751,510 - 751,510 667,090 369,723 4,287) 1,032,526 $1,784,036 $3,215,885 1,848,738 1,039,374 2,888,112 186,099 796,548 1,159,302 2,141,949 7,154 $8,253,100	Provision of thePeriod $ 528,815 - 528,815 565,436 368,225 - 933,661 $1,462,476 $1,795,307 1,798,690 1,033,934 2,832,624 - - 7,577 7,577 7,333 $4,642,841	Recovery of thePeriod $ 425,458 - 425,458 667,090 369,723 - 1,036,813 $1,462,271 $1,592,272 1,848,738 1,039,374 2,888,112 2,023 - 8,835 10,858 7,154 $4,498,396		Others $ - - - - - 8 8 $ 8 $ - - - - - - - - - $ -		March 31, 2020
	(						(	$ 854,867 - 854,867 565,436 368,225 4,279) 929,382 $1,784,249 $3,418,920 1,798,690 1,033,934 2,832,624 184,076 796,548 1,158,044 2,138,668 7,333 $8,397,545

Note: According to the “Directions for Strengthening Natural Disaster Insurance (Commercial Earthquake, Typhoon, and Flood Insurance) Reserve by Non-Life Insurance Enterprises”, issued with Jin-Guan-Bao-Cai-Zi No. 10102515061, November 9, 2012, the special reserves for material accidents are reclassified to the special reserves for contingency reserves.

• 36 -

Based on the “Directions for Strengthening Natural Disaster Insurance (Commercial Earthquake, Typhoon, and Flood Insurance) Reserve by Non-Life Insurance Enterprises”, the “Notes to Enhancing the Reserves of Members of Residential Earthquake Insurance Co-Insurance Organization”, and the Requirement 2 specified in the Letter Jin-Guan-Bao-Cai-Zi No. 10102517095, December 28, 2012, from January 1, 2013, the Company first complements the reserves for material accidents for commercial earthquake insurance and typhoon and flood insurance and the special reserves for hazard changes to the full water level with the special reserves accounted under the liabilities provided before December 31, 2012; the remaining, after deducting the income tax, is accounted to the special earning reserves under Equity based on IAS 12.

During January 1 to March 31, 2021, the summary of effects to which the enhancing disaster reserve mechanism, and reserves of enhancing residential earthquake and nuclear energy insurance are listed as follows:

Amount applied Amount not applied Effects	Current net loss ($ 21,160) ( 22,778) $ 1,618	Loss pershare ($ 0.06) ( 0.06) $ -		Total Liabilities	(	Equity
				$ 12,381,082 11,178,244 $ 1,202,838		$ 9,464,010 10,519,167 $ 1,055,157)

During January 1 to March 31, 2020, the summary of effects to which the enhancing disaster reserve mechanism, and reserves of enhancing residential earthquake and nuclear energy insurance are listed as follows:

Amount applied Amount not applied Effects		Net Profit for thePeriod $ 130,320 128,702 $ 1,618		Earnings Per Share (EPS) $ 0.36 0.36 $ -		Total Liabilities	(	Equity
						$ 10,293,289 9,082,360 $ 1,210,929		$ 8,534,003 9,582,687 $ 1,048,684)

XIX. Equity

(I) Capital

Common Stock

Common Stock
Authorized shares (thousand shares) Authorized capital The number of issued and outstanding shares with paid-in capital (thousand shares) Issued and outstanding share capital	March31,2021 600,000 $ 6,000,000 362,200 $ 3,622,004	December31,2020 600,000 $ 6,000,000 362,200 $ 3,622,004	March31,2020
				600,000 $ 6,000,000 362,200 $ 3,622,004

• 37 -

(II) Capital surplus

Capital surplus
May be used for making up losses, or be distributed cash or provided as the share capital Premium in stock issuance Treasury stock transaction	March31,2021 $ 1,915 97,047 $ 98,962	December31,2020 $ 1,915 97,047 $ 98,962	March31,2020
				$ 1,915 97,047 $ 98,962

Such capital surplus may be used to offset a deficit; when the Company has no deficit, such capital surplus may be distributed as cash dividends or stock dividends up to a certain percentage of the Company’s paid-in capital.

(III) Retained earnings and dividend policy

Based on the distribution of earnings policy in the Company Charter, shall there be earnings after the annual settlement, the earnings shall offset the accumulated deficit from the previous years, and pay all the taxes, and 20% of the remaining shall be provided as the legal reserve. However, if the legal reserve reaches the total capital of the Company, the said requirement is not applicable. When the special reserve is provided or reversed based on laws, the remaining amount may be combined with the balance of the undistributed earnings at the beginning of the period and the adjusted amount of the undistributed earnings of the year, for the purpose of proposing the earnings distributions for the shareholders’ meeting to determine. For the motion for distribution of earnings referred to in the preceding paragraph, the distributable dividends and bonuses, in whole or in part, are paid in cash after a resolution has been adopted by a majority votes at a meeting of the Board of Directors attended by two-thirds of the total number of directors, and a report of such distribution shall be submitted to the shareholders’ meeting. For the policy for distributing compensation of employees and directors specified in the Company Charter, please refer to Note 20(7), “Compensations of Employees and Directors.”

The Company is an insurance enterprise. As the competition has been intensifying since the opening of the insurance market, by taking into account of the ability of covering of the Company, enhancement of solvency, future needs of funds, and the long-term financial plans, as well as to properly meet the shareholders’ demand for cash inflows, the Board of Directors takes stable and balanced dividend policy for the profit distribution proposal of the year, and adjust the percentage of the equity dividend and cash dividends upon its discretions. The cash dividends are no

• 38 -

less than 10% of the total dividends; however, if the cash dividend per share is lower than NT$0.1, it may be distributed in equity dividend.

Based on the “Regulations on Provision of Various Reserves for Insurance Enterprises” amended by the Letter Jin-Guan-Bao-Cai-Zi No. 09802513192, December 28, 2009, from January 1, 2011, the new provisions of the special reserves for material accidents and the special reserves for hazard changes each year shall be accounted to special reserves at the end of each year. Therefore, the earning of this portion shall not be distributed or used of other purpose. As of March 31, 2021 and 2020, the net provision was NT$77,440 thousand and NT$48,481 thousand, respectively. The net provision as of December 31, 2020 was NT$172,097 thousand.

The legal reserve shall be provided until the balance achieve the amount of the total paid-up capital of the Company; the legal reserve can be used to offset the deficits. Where the Company did not operate at a loss, the part of the legal reserve in excess of 25% of the paid-in capital could be taken as capital and may be allocated in cash as well. Furthermore, based on Jin-Guan-Bao-Cai-Zi No. 10202501991, “the insurance enterprises that intend to distribute the legal reserve and capital surplus in cash pro rata to the original holdings of shareholders based on Article 241 of the Company Act shall meet certain criteria”, to enhance the solvency and strengthen the operation of the companies, not only to meet the abovementioned criteria are to be met, the following requirements are also to be met, and such distribution shall be approved by FSC before the shareholders’ meeting, the legal reserve and capital surplus may be distributed in cash based on Article 241 of the Company Act.

The criteria specified in Jin-Guan-Bao-Cai-Zi No. 10202501991 are as follows:

1. The legal reserve provided based on Paragraph 1, Article 145-1 of the Insurance Act has achieved the total amount of paid in capital or funds.

2. The ratio of the latest period of self-owned capital to the risk capital has achieved 250% after deducting the distribution of earnings in cash, cash distributed from capital reserve, and cash distributed from legal reserve.

3. The latest financial report for the year and six months (if the application date exceeding more than six month over the year) are certified by CPA without reserved opinion.

4. The improvements have been made according to the advices for internal control provided by CPA when conducting auditing and certification within the

5. 39 -

latest year and six months (if the application date exceeding more than six month over the year) .

1. No fine over NT$1 million has been enforced by the competent authorities within the past year. However, shall the tangible improvement against these violations have been made and approved by the competent authorities, the previous requirement does not apply.

2. Healthy financial business with solvency.

3. There is no deficit or accumulated deficit, and no other fact showing any material internal control defect or possible hurdle to healthy operations.

The Company has held the meeting of the Board on March 26, 2021, and the annual general meeting on June 12, 2020, and resolved to pass the distribution of the earnings for 2020 and 2019, respectively, as follows:

Legal reserve Special reserve Cash dividend	Disposition of net earnings 2020 2019 $ 142,688 $ 139,252 170,425 197,621 398,421 362,201	Dividends Per Share ($)	Dividends Per Share ($)
	2020 $ 142,688 170,425 398,421	2020 $ 1.1	2019 $ 1.0

With respect to the 2020 earning distribution, the cash dividends have been allocated upon resolution of the Board of Directors. The remainder will be disposed of per the resolution made at the annual general meeting on June 18, 2021.

• (IV) Special reserve

The changes in the special reserve from January 1 to March 31, 2021 and 2020 are stated as follows:

are stated as follows:
Balance at January 1, 2020 Provision of the period Recovery of the Period Balance at March 31, 2020 Balance at January 1, 2021 Provision of the period Recovery of the Period Balance at March 31, 2021	Special reserves $ 1,735,507 - ( 14,062) $ 1,721,445 $ 1,907,604 - ( 5,406) $ 1,902,198	Provisions by initial application of IFRSs $ 671,714 - ( 3,111) $ 668,603 $ 657,447 - ( 4,841) $ 652,606		Special reserve form fin-tech employee transformation $ 8,330 - - $ 8,330 $ 6,658 - - $ 6,658		Total
	( (	( (			( (	$ 2,415,551 - 17,173) $ 2,398,378 $ 2,571,709 - 10,247) $ 2,561,462

When the Company initially applied IFRSs, the unrealized value added amount from the re-evaluation is NT$698,510 thousand, and the special reserve has been provided for the same amount. As of the reporting date, for the disposal of property

• 40 -

and equipment, NT$45,904 thousand of special reserve provided for the unrealized value added amount from the re-evaluation for real estate, will be reversed.

The special reserve provided for the investment properties other than lands when initially applying IFRSs, may be reversed period by period during the usage period. The special reserve provided for lands, may be reversed when being disposed or reclassified. When distributing earnings, the special reserve shall be provided for the difference between the net deduction under other equity to shareholders and the special reserve provided for the initial application of IFRSs. Afterwards, if there is any reversal for the deduction under other equity to shareholders, the reversed portion may be distributed of earnings.

Based on Jin-Guan-Bao-Cai-Zi No. 10502066461 Letter on July 13, 2016, to respond to the development trend of fin-tech, assist the employees of insurance enterprises, and protect their interests, an insurance enterprises shall, when distributing the earnings of FY 2016 to 2018, a special reserve shall be made based on the range of 0.5% to 1% of after-tax earning against the distributable earnings. According to the decree under Jin-Guan-Bao-Cai-Zi No. 10804932431 dated July 30, 2019, since the fiscal year of 2019, when disbursing related expenses, the insurance industry may reverse the same amount within the balance of the special reserve provided by the earnings of the fiscal years of 2016~2018.

• (V) Other equity

Unrealized valuation gain and losses on financial assets at fair value through other

comprehensive income

comprehensive income
Balance - beginning Those yielded in the current term Unrealized profit/loss Liability instruments Equity instrument Adjustment to the allowance loss of bond instrument Other comprehensive income for the period The accumulated profit/loss by disposing equity instrument transferred to the retained earnings Balance - ending	From January 1 to March 31, 2021 $ 108,744 ( 16,732) 319,851 ( 61) 303,058 ( 85,672) $ 326,130	From January 1 to March 31, 2020
		($ 46,941) 1,878 ( 323,801) ( 67) ( 321,990) - ($ 368,931)

• 41 -

XX. Net Income from continuing operation

• (I) Gain (loss) on financial assets and liabilities at fair value through profit or loss

Gain (loss) on disposal Gain (loss) on valuation Equity instrument Liability instruments	From January 1 to March 31, 2021 $ 2,832 42,864 ( 1,065) $ 44,631	From January 1 to March 31, 2020
	(	$ 129 ( 34,188) 9,588 ($ 24,471)

• (II) Realized gain and losses on financial assets at fair value through other comprehensive income

income
Dividend Gain (loss) on investment properties Rental revenue from investment properties Gain/Loss of disposal of investment properties Direct operational expenses of investment properties	From January 1 to March 31, 2021 $ 275 From January 1 to March 31, 2021 $ 29,083 3,688 ( 8,719) $ 24,052	From January 1 to March 31, 2020
		$ - From January 1 to March 31, 2020
	(	(	$ 30,687 23,723 8,935) $ 45,475

• (III) Gain (loss) on investment properties

• (IV) Expected credit impairment losses and reversal of gains of investments

Bond instruments measured at fair value through other comprehensive income Gain (loss) of foreign currency Gain (loss) of investment exchange Other gain (loss) of exchange	From January 1 to March 31, 2021 $ 61 From January 1 to March 31, 2021 $ 1,787 403 $ 2,190	From January 1 to March 31, 2020	From January 1 to March 31, 2020
		$ 67 From January 1 to March 31, 2020
		(	$ 1,436 625) $ 811

• (V) Gain (loss) of foreign currency

• 42 -

(VI) Summary of nature of employee benefits, depreciation and amortization for the period

	FromJanuary1toMarch31,2021	FromJanuary1toMarch31,2021	FromJanuary1toMarch31,2021	FromJanuary1toMarch31,2020	FromJanuary1toMarch31,2020	FromJanuary1toMarch31,2020
	Classified as operating cost	Classified as operating expense	Total	Classified as operating cost	Classified as operating expense	Total
Employee fringe benefit expenses	$ 90,211	$ 195,077	$ 285,288	$ 63,849	$ 194,347	$ 258,196
Salaries expense	90,211	152,013	242,224	63,849	155,197	219,046
Expenses for labor and health insurance	-	20,308	20,308	-	18,730	18,730
Pension expense	-	7,637	7,637	-	7,443	7,443
Remuneration to directors	-	11,606	11,606	-	11,477	11,477
Other employee fringe benefit expenses	-	3,513	3,513	-	1,500	1,500
Depreciation expense - Property and equipment	-	3,592	3,592	-	3,755	3,755
Depreciation expense - Investment properties	4,822	-	4,822	4,881	-	4,881
Depreciation expense - Right-of-use assets	-	6,237	6,237	-	6,230	6,230
Amortization expenses	-	1,147	1,147	-	728	728

Note: As of March 31, 2021 and 2020, the number of employees is 912 and 904, respectively; among them, 11 directors and 9 directors do not serve as employees concurrently.

(VII) Compensation to Employees and Remuneration to Directors

The Articles of Incorporation amended by the Company has been approved per the resolution made by the shareholders’ meeting on June 12, 2020. Based on the amended Articles of Incorporation, the Company allocated the remuneration to employees and directors at 1–5% and no more than 5% of the pre-tax profit before allocating the remuneration to employees and directors in the year. No independent directors were allowed to participate in the allocation of remuneration to directors. Based on the Articles of Incorporation before the amendments thereto, the Company provided the remuneration to employees and directors at 1–5% and no more than 5% of the pre-tax profit before allocating the remuneration to employees and directors in

• 43 -

the year. From January 1 to March 31, 2021 and 2020, the estimated compensations to employees and directors are as the following:

Percentage of estimation

Percentage of estimation
Employee Compensation Directors’ remuneration Amount Employee Compensation Directors’ remuneration	From January 1 to March 31, 2021 - - From January 1 to March 31, 2021 $ - $ -	From January 1 to March 31, 2020
		2.5% 2.5% From January 1 to March 31, 2020
			$ 4,309 $ 4,309

Shall there be any change to the annual financial report after the reporting date, the accounting treatment shall be applied, and the adjustment is accounted in the next year.

The estimated employees’ compensation and directors’ remuneration for 2020 and 2019 are respectively resolved by the Board of Directors on March 26, 2021 and March 20, 2020, as the following:

March 20, 2020, as the following:
Employee Compensation Directors’ remuneration		2020 Cash $ 20,340 $ 20,340		2019
				Cash
				$ 21,939 $ 21,939

The actual resolved amounts for the employees’ compensation and directors’ remuneration for 2020 and 2019 are not different from the amounts recognized in the financial statement of 2020 and 2019.

For the employees’ compensation and directors’ remuneration for 2021 and 2020 resolved by the Board of Directors, please check the “Market Observation Post System” at TWSE.

• 44 -

XXI. Income tax of the units in continued business operation

(I) Income tax recognized in profit and/or loss

The income tax benefits (expenses) are primarily composed of the following

items:

items:	items:	items:
From January 1 to March 31, 2021 Income tax for the current Those yielded in the current period $ - Additional business profit tax levied on unappropriated retained earnings Those yielded in the current period ( 95) Deferred income tax Those yielded in the current period 26,281 Income tax benefits (expenses) recognized in profit and/or loss $ 26,186 NCOME TAX ASSETS OF THE PERIOD March 31, 2021 December 31, 2020 Income Tax Assets of the Period Prepaid income tax $ 920 $ - ncome tax liabilities of the period March 31, 2021 December 31, 2020 Income tax liabilities of the period Income tax payable $ 38,918 $ 38,823			From January 1 to March 31, 2020
				($ 34,497) - 1,094 ($ 33,403) March 31, 2020
	$ - December 31, 2020			$ - March 31, 2020
		$ 38,823			$ 98,591

(II) INCOME TAX ASSETS OF THE PERIOD

(III) Income tax liabilities of the period

(IV) Information related to tax credit against loss

The information related to tax credit against loss available until March 31, 2021

is stated as following:

following:
Balance not yet deducted $ 123,279	The last year for deduction
	2031 years

• 45 -

(V) Verification of income tax

The Company’s profit-seeking enterprise income tax returns through 2018 have

been examined and approved by the tax authority.

XXII. Earnings (loss) per share

Earnings (loss) per share
Basic earnings (loss) per share Diluted earnings (loss) per share	From January 1 to March 31, 2021 ($ 0.06) ($ 0.06)	From January 1 to March 31, 2020
	( (		$ 0.36 $ 0.36

The net income (loss) for calculating the earnings (loss) per share and the weighted average number of common shares are as follows:

Current net income (loss)

Current net income (loss)
Net income (loss) attributed to the owner of the Company/net income (loss) for calculating the basic earnings (loss) per share Net income (loss) attributed to the owner of the Company/net income (loss) for calculating the diluted earnings (loss) per share. Shares The weighted average number of common shares to be used to calculate basic earnings (loss) per share Potential impact of common stock with dilution: Employee Compensation The weighted average number of common shares to be used to calculate diluted earnings (loss) per share	From January 1 to March 31, 2021 From January 1 to March 31, 2020 ($ 21,160) $ 130,320 ($ 21,160) $ 130,320 Unit: thousand shares From January 1 to March 31, 2021 From January 1 to March 31, 2020 362,200 362,200 875 1,330 363,075 363,530

If the Company may opt to release the employees’ compensation in shares or

cash, the calculation of diluted EPS assumes the employees’ compensation is released in shares, and included the weighted average outstanding shares when such common shares have diluting effect, to calculate the diluted EPS. When calculating

• 46 -

the diluted EPS before resolving the amount of shares to be released as the employees’ compensation in the next year, the diluting effects of such potential common shares are taken into account still.

XXIII. Financial instruments

• (I) Information of Fair Value - financial instruments at fair value on the repetitive basis. 1. Level of fair value

March 31, 2021

March 31, 2021
Financial assets at fair value through profit or loss TWSE/GTSM listed shares Beneficiary certificates of funds Domestic financial bonds Domestic corporate bonds Total Financial assets at fair value through other comprehensive income Investments in equity instruments - TWSE/GTSM listed shares and emerging shares - Unlisted domestic shares Investments in liability instruments - Domestic government bonds - Domestic financial bonds - Domestic corporate bonds - Overseas corporate bonds - Overseas financial bonds Total December 31, 2020 Financial assets at fair value through profit or loss TWSE/GTSM listed shares Beneficiary certificates of funds Domestic financial bonds Domestic corporate bonds Total Financial assets at fair value through other comprehensive income Investments in equity instruments - TWSE/GTSM listed shares and emerging shares - Unlisted domestic shares Investments in liability instruments - Domestic government bonds - Domestic financial bonds - Domestic corporate bonds - Overseas corporate bonds - Overseas financial bonds Total		Level 1 $ 249,079 280,357 - - $ 529,436 $ 3,599,671 - - - - - - $ 3,599,671 Level 1 $ 204,920 156,780 - - $ 361,700 $ 3,310,661 - $ - - - - - $ 3,310,661		Level 2 $ - - - - $ - $ - - 614,935 49,998 103,964 598,152 - $ 1,367,049 Level 2 $ - - - - $ - $ - - $ 622,187 49,998 104,110 693,692 - $ 1,469,987		Level 3 $ - - 1,154,223 521,701 $ 1,675,924 $ - 384,878 - - - - 142,507 $ 527,385 Level 3 $ - - 1,054,592 522,397 $ 1,576,989 $ - 358,056 $ - - - - 142,258 $ 500,314		Total
								$ 249,079 280,357 1,154,223 521,701 $ 2,205,360 $ 3,599,671 384,878 614,935 49,998 103,964 598,152 142,507 $ 5,494,105 Total
								$ 204,920 156,780 1,054,592 522,397 $ 1,938,689 $ 3,310,661 358,056 $ 622,187 49,998 104,110 693,692 142,258 $ 5,280,962

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March 31, 2020

March 31, 2020
Financial assets at fair value through profit or loss TWSE/GTSM listed shares Beneficiary certificates of funds Domestic financial bonds Domestic corporate bonds Total Financial assets at fair value through other comprehensive income Investments in equity instruments - TWSE/GTSM listed shares - Unlisted domestic shares Investments in liability instruments - Domestic government bonds - Domestic financial bonds - Domestic corporate bonds - Overseas corporate bonds - Overseas financial bonds Total		Level 1 $ 321,069 76,719 - 10,100 $ 407,888 $ 2,626,043 - - - - - - $ 2,626,043		Level 2 $ - - - - $ - $ - - 616,589 150,166 104,552 756,310 - $ 1,627,617		Level 3 $ - - 886,967 521,033 $ 1,408,000 $ - 379,681 - - - - 151,000 $ 530,681		Total
								$ 321,069 76,719 886,967 531,133 $ 1,815,888 $ 2,626,043 379,681 616,589 150,166 104,552 756,310 151,000 $ 4,784,341

There was no transfer between fair value measurement level 1 and level 2 in January 1 to March 31, 2021 and 2020.

1. Reconciliation for the financial instruments measured at fair value level 3

From January 1 to March 31, 2021

Financialassets Balance - beginning Recognized in profit/loss ( profit/loss on financial assets and liabilities at fair value through profit or loss) Recognized into income－ exchange profit and/or loss Recognized in other comprehensive profit/loss (unrealized profit/loss at fair value through other comprehensive income) Added Balance - ending Other unrealized gain/loss of the current period recognized into the profit and/or loss	Financial assets at fair value through profit or loss Liability instruments $ 1,576,989 ( 1,065) - - 100,000 $ 1,675,924 ($ 1,065)	Financial assets at fair value through other comprehensive income Liability instruments Equity instrument $ 142,258 $ 358,056 - - 250 - ( 1) 26,822 - - $ 142,507 $ 384,878 $ 250 $ -	Financial assets at fair value through other comprehensive income Liability instruments Equity instrument $ 142,258 $ 358,056 - - 250 - ( 1) 26,822 - - $ 142,507 $ 384,878 $ 250 $ -	Total
		Liability instruments $ 142,258 - 250 ( 1) - $ 142,507 $ 250
				$ 2,077,303 ( 1,065) 250 26,821 100,000 $ 2,203,309 ($ 815)

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From January 1 to March 31, 2020

Financial assets Balance - beginning Recognized in profit/loss ( profit/loss on financial assets and liabilities at fair value through profit or loss) Recognized into income－ exchange profit and/or loss Recognized in other comprehensive profit/loss (unrealized profit/loss at fair value through other comprehensive income) Added Balance - ending Other unrealized gain/loss of the current period recognized into the profit and/or loss	Financial assets at fair value through profit or loss Liability instruments $ 1,398,128 9,872 - - - $ 1,408,000 $ 9,872		Financial assets at fair value through other comprehensive income Liability instruments Equity instrument $ 150,000 $ 365,862 - - 1,000 - - ( 6,283) - 20,102 $ 151,000 $ 379,681 $ 1,000 $ -	Total
			Liability instruments $ 150,000 - 1,000 - - $ 151,000 $ 1,000
				$ 1,913,990 9,872 1,000 ( 6,283) 20,102 $ 1,938,681 $ 10,872

1. The evaluation skills and inputs for Level 2 fair value measurement

Categories of financial instruments Evaluation skills and inputs TSEC/GTSM listed bond investments

• Cash Flow Discount Method: Discounting Based on the Market Interest Rate Reflecting the Similar Products of the Issuers at the End of Period and the Credit Rating.

• The evaluation skills and inputs for Level 3 fair value measurement

Categories of financial instruments Evaluation skills and inputs

TSEC/GTSM listed bond investments

Investments in unlisted domestic shares

• Based on cash flow discount approach, the present value of incomes to be obtained by holding the investment. The material unobservable input is the discount factor (yield), is obtained by considering the premium reward of risks and the reference interest rate of corporate bonds.

• Based on the asset-based approach, reflect the entire value of the enterprise or business in terms of the total market values for the individual assets and liabilities applicable to the evaluated subject. The material unobservable input is the liquidity discount, minority interest discount, and financial information of the investees.

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The Company’s measurement of the fair value of financial instruments is reasonable; however, if different evaluation models or parameters are applied, the outcome of evaluations may be different. For the financial instrument classified as Level 3, the effects to market value when evaluation parameters change are as follows:

Item	Inputs value	Ranges	Upward or downward changes	Effect ofchangesin fairvalue	Effect ofchangesin fairvalue
				Positive change	Negative change
March 31, 2021 ASSETS Bond investment Stock investment December 31, 2020 ASSETS Bond investment Stock investment March 31, 2020 ASSETS Bond investment Stock investment	Discount rate Financial Information of the Investees Liquidity Discount Minority Interest Discount Discount rate Financial Information of the Investees Liquidity Discount Minority Interest Discount Discount rate Financial Information of the Investees Liquidity Discount Minority Interest Discount	1.29%~4.01% $17,406~$20,060 10% 10% 1.31%~4.01% $17,770~$19,710 10% 10% 1.60%~4.17% $232~$158,811 10%~20% 10%	100 bp change upward 5% change downward 10% change upward 10% change upward 100 bp change upward 5% change downward 10% change upward 10% change upward 100 bp change upward 5% change downward 10% change upward 10% change upward	$ - - - - $ - - - - $ - - - -	( $ 403,254 ) ( 1,381 ) ( 42,534 ) ( 42,534 ) ( $ 385,466 ) ( 1,426 ) ( 39,554 ) ( 39,554 ) ( $ 355,547 ) ( 1,009 ) ( 42,466 ) ( 30,776 )

The positive and negative changes of the Company refer to the fluctuation of the fair value; the fair value is obtained by calculating with the evaluation skills of the unobservable input parameters at different degrees.

Shall the financial instrument is affected by one or more inputs, the table above only reflect the effect incurred from one single input change, without considering the relativeness and variability among inputs.

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(II) Categories of financial instruments

Financial assets At fair value through profit and loss Financial assets carried at amortized cost (Note 1) At fair value through other comprehensive income Investments in equity instruments Investments in liability instruments Financial liabilities At amortized cost (Note 2)	March 31, 2021 $ 2,205,360 9,834,719 3,984,549 894,621 1,792,929	December 31, 2020 $ 1,938,689 8,239,511 3,668,717 990,058 1,029,277	March 31, 2020
			$ 1,815,888 8,037,527 3,005,724 1,162,028 1,339,246

• Note 1: The balance includes the financial assets at amortized costs, such as cash and cash equivalents, note receivables, premium receivables, other receivables, claim recoverable from reinsurers, due from reinsurers and ceding companies, other financial assets - net, and refundable deposits.

• Note 2: The balance includes financial liabilities at amortized costs, such as the claims payable, commissions payable, due to reinsurers and ceding companies, other payable, and refundable deposit.

(III) The objectives and policies of financial risk management

The major financial instruments of the Company include the equity and bond instrument investment, receivables, and payables. The financial management department of the Company supervises, and manages the financial risks related to the Company’s operation based on internal risk report analyzing the degrees and breadth of exposures. Such risks include market risks(including foreign exchange risks, interest rate risks, and other price risks), credit risks and liquidity risks. The Risk Management Committee established by the Company is the independent organization established solely for supervising risks and policy implementation to reduce exposures.

1. Market risk

The operating activities of the Company cause the Company to assuming the major financial risks as the risk of foreign exchange change (refer to following (1)) and the risk of interest rate change (refer to following (2)).

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The Company’s exposure to market risks of financial instruments, and approaches toward managing and measuring such exposures have not changed.

• (1) Foreign exchange rate risk

For the currency assets and currency liabilities denominated in non-functional currency on the balance sheet date, please refer to Note 29.

Analysis of sensitivity

The Company is mainly affected by the fluctuation of USD.

The following table explains in detail the analysis of sensitivity when the exchange rates of NT$ (the functional currency) against other related foreign currencies increase or decrease 1%. 1% is the sensitivity percentage used when internally reporting the exchange rate risks to the major management, as well as represents the evaluation for the reasonably possible extent of changes of foreign exchange by the management. The analysis of sensitivity only includes the outstanding foreign currency items, and the translation at the end of period is adjusted

at 1% of exchange rate change. The positive figures in the following table are the amount increased for the pre-tax net profit or equity when NT$ against the related currencies appreciate 1%; when NT$ against the related currencies depreciate 1%, the effects to the pre-tax net profit or equity will be negative at the same amount.

Profit and loss (i)	Effects from USD From January 1 to March 31, 2021 From January 1 to March 31, 2020 $ 8,653 $ 8,750	Effects from RMB
	From January 1 to March 31, 2021 $ 8,653	From January 1 to March 31, 2021 From January 1 to March 31, 2020
		$ 2,443 $ 2,585

(i) Mainly originated from the USD and RMB denominated financial instruments outstanding on the balance sheet date and without being hedged against the cash flows.

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(2) Interest rate risks

At the balance sheet date, the carrying amount of financial assets exposed to interest rates are as follows:

Interest rate risk with fair value - Financial assets	March 31, 2021 $ 3,185,479	December 31, 2020 $ 3,189,233	March 31, 2020
			$ 3,196,718

Analysis of sensitivity

The following analyses of sensitivity are determined based on the interest rate exposure of the non-derivative instruments at the balance sheet dates. When internally reporting the interest rates to the major management, the variable interest rates applied is the interest rates increase or decrease 100 base points, and also represent the evaluation for the reasonably possible extent of changes of interest rate by the management.

If the interest rate increases for 100 base points, while other variables are kept the same, the other comprehensive income after tax during January 1 to March 31, 2021 and 2020 will decrease NT$459,062 thousand and NT$428,960 thousand, respectively, the main reason is the changes from the fair value of the fixed interest rate debt instruments.

(3) Other Price Risks

The Company suffered the equity price risk arising from the investment in equity securities and beneficiary certificates of funds.

Analysis of sensitivity

The following analyses of sensitivity are determined based on the price risk over equity securities and beneficiary certificates of funds at the balance sheet dates.

If the equity price increased/dropped by 1%, the income before tax would have increased/decreased by NT$5,294 thousand and NT$3,978 thousand due to the increase/decrease in the fair value of financial assets at fair value through profit or loss from January 1 to March 31, 2021 and 2020. The other comprehensive income before tax would have increased/decreased by NT$39,845 thousand and NT$30,057 thousand due to the increase/decrease in the fair value of other financial assets at

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fair value through comprehensive income from January 1 to March 31, 2021 and 2020.

2. Credit risk

Credit risk represents the potential loss that would be incurred by the Company if the counter-parties or third parties breached the contracts. The Company’s financial instruments are affected by its credit risk concentration, component, contract amounts and other receivables. As the counterparties of the Company are the creditworthy financial institutions with low possibility of default, it is expect the material credit risk is unlikely.

- Credit risk exposure by territory

March 31, 2021

March 31, 2021
Financial assets	Taiwan	Asia	America	Others	Total
Cash and cash equivalents	$ 4,754,317	$ -	$ -	$ -	$ 4,754,317
Financial assets at fair value through profit or loss	1,675,924	-	-	-	1,675,924
Financial assets at fair value through other comprehensive income	1,098,630	163,335	-	247,591	1,509,556
Total	$ 7,528,871	$ 163,335	$ -	$ 247,591	$ 7,939,797
% byterritory	94.82%	2.06%	-	3.12%	100.00%

December 31, 2020

December 31, 2020
Financialassets	Taiwan	Asia	America	Others	Total
Cash and cash equivalents	$ 3,741,100	$ -	$ -	$ -	$ 3,741,100
Financial assets at fair value through profit or loss	1,576,989	-	-	-	1,576,989
Financial assets at fair value through other comprehensive income	1,108,404	250,050	-	253,791	1,612,245
Total	$ 6,426,493	$ 250,050	$ -	$ 253,791	$ 6,930,334
% byterritory	92.73%	3.61%	-	3.66%	100.00%

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March 31, 2020

March 31, 2020
Financial assets	Taiwan	Asia	America	Others	Total
Cash and cash equivalents	$ 3,290,364	$ -	$ -	$ -	$ 3,290,364
Financial assets at fair value through profit or loss	1,418,100	-	-	-	1,418,100
Financial assets at fair value through other comprehensive income	1,149,737	319,805	62,939	246,136	1,778,617
Total	$ 5,858,201	$ 319,805	$ 62,939	$ 246,136	$ 6,487,081
% byterritory	90.31%	4.93%	0.97%	3.79%	100.00%

3. Liquidity risk

The Company maintained sufficient fund to meet our operating capital requirements. Therefore, no liquidity risks associated with failure to source required funding are anticipated.

Liquidity of non-derivative financial liabilities and statement of interest rate

risk

The following Table shows the analysis on the remaining contractual maturity for the non-derivative financial liabilities for which the Company has agreed on the repayment term. It was prepared based on the earliest date the Company might be asked to make the repayment, as well as the undiscounted cash flow from the financial liabilities.

March 31, 2021

March 31, 2021	March 31, 2021
On demand or shorter than 3 months Liabilities without interest $ 1,094,007 Lease liabilities 5,538 $ 1,099,545 December 31, 2019 On demand or shorter than 3 months Liabilities without interest $ 763,639 Lease liabilities 5,526 $ 769,165			3 months - 1 year $ 446,776 23,421 $ 470,197 3 months - 1 year $ 15,134 23,984 $ 39,118		1-5 years $ 22,286 39,802 $ 62,008 1-5 years $ 17,006 44,303 $ 61,309		More than 5 years
							$ 3,773 - $ 3,773 More than 5 years
Liabilities without interest Lease liabilities
							$ 7,410 - $ 7,410

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March 31, 2020

March 31, 2020
Liabilities without interest Lease liabilities	On demand or shorter than 3 months $ 686,532 5,411 $ 691,943		3 months - 1 year $ 408,129 19,440 $ 427,569		1-5 years $ 27,884 39,666 $ 67,550		More than 5 years
							$ 735 - $ 735

• (IV) Based on Article 7 of the “Regulations Governing Insurance Enterprises Engaging in Operating Reinsurance and Other Risk Spreading Mechanisms”, the unqualified counterparties for the ceding reinsurance of the Company by March 31, 2021 are as follows:

follows:
Counterparties of Reinsurance	Insurance type
Lemma Insurance Company	Temporary ceding reinsurance for marine hull insurance
Tugu Insurance Company Limited	Temporary ceding reinsurance for commercial fire insurance, marine cargo insurance, and marine hull insurance.
Trust International Insurance & Reinsurance Company B.S.C.(c), Trust Re	Temporary ceding reinsurance for commercial fire insurance, and marine hull insurance.
Asia Capital Reinsurance Group Pte Ltd	Temporary ceding reinsurance for marine hull insurance and aviation insurance, and cargo reinsurance.
Asia Capital Reinsurance Group Pte Ltd Hong Kong Branch Office	Temporary ceding reinsurance for commercial fire insurance, and commercial fire reinsurance and cargo reinsurance.

The unqualified premium expense is NT$ 0 thousand, the reserves for unqualified reinsurance is NT$806 thousand, all belongs to the ceding claims reported but not claimed reserves.

Based on Article 7 of the “Regulations Governing Insurance Enterprises Engaging in Operating Reinsurance and Other Risk Spreading Mechanisms”, the unqualified counterparties for the ceding reinsurance of the Company March 31, 2020 are as follows:

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Counterparties of Reinsurance	Insurance type
Lemma Insurance Company	Temporary ceding reinsurance for marine hull insurance
Tugu Insurance Company Limited	Temporary ceding reinsurance for commercial fire insurance, marine cargo insurance, and marine hull insurance.
Trust International Insurance & Reinsurance Company B.S.C.(c), Trust Re	Temporary ceding reinsurance for commercial fire insurance, and marine hull insurance
Asia Capital Reinsurance Group Pte Ltd	Marine hull insurance, temporary ceding reinsurance for aviation insurance, and cargo reinsurance
Asia Capital Reinsurance Group Pte Ltd Hong Kong Branch Office	Temporary ceding reinsurance for commercial fire insurance, engineering insurance, and fishing vessel insurance, and cargo reinsurance

The ineligible premium expense was NT$3,805 thousand; the ineligible reinsurance reserves was NT$8,087 thousand. The components include ceding unearned premium reserves for NT$1,903 thousand, claim recoverable from reinsurers to the reported and paid claims for NT$688 thousand, and the ceding claims reported but not claimed reserves for NT$5,496 thousand.

XXIV. Transactions with Related Parties

• (I) Information about the Company’s related parties were as follows

Name of the Related Parties Bank of Taiwan Co., Ltd. Yong-Shin Development Co., Ltd. Tong-Sheng Development Co., Ltd. Navigator Real Estate Co., Ltd. Navigator Investment Co., Ltd. Taiwan Navigator Asset Investment Co., Ltd. Taiwan Business Bank, Ltd. Goldsun Building Materials Co., Ltd. Bank Taiwan Insurance Brokers Co., Ltd. Taiming Assurance Broker Co., Ltd. Sirtec International Co., Ltd. Hua Nan Commercial Bank, Ltd.

Relationship with the Company

Major Management Major Management Investor with significant effects Investor with significant effects Investor with significant effects Related party in substance Related party in substance Related party in substance Related party in substance Related party in substance Related party in substance Related party in substance

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Name of the Related Parties Forland Auto Trade Holding Co., Ltd. Taipei Branch (Cayman) Other related parties	Relationship with the Company
	Related party in substance Directors, supervisors, chairman, president, managers, their spouses, and the relatives within 2nd degree of kinship

• (II) Significant related-party transactions were as follows

• Deposit

Checking deposits and Demand deposits:

Major Management Bank of Taiwan Co., Ltd. Related party in substance Taiwan Business Bank Hua Nan Commercial Bank	March31,2021 $ 1,041,647 74,971 1,930 $ 1,118,548		December 31, 2020 $ 638,950 65,498 1,468 $ 705,916	March31,2020	March31,2020
					$ 654,904 95,859 1,922 $ 752,685

Time deposits (including cash and cash equivalents, and other financial assets listed in accounts):

Major Management Bank of Taiwan Co., Ltd. Related party in substance Taiwan Business Bank	March31,2021 $ 246,725 134,961 $ 381,686	December 31, 2020 $ 241,665 137,017 $ 378,682	March31,2020	March31,2020
				$ 264,065 140,017 $ 404,082

The time deposits in the related parties apply the interest rate of 0.06% ~

2.70% as of March 31, 2021. As of December 31 and March 31, 2020, the interest rates were 0.06% ~ 2.25% and 0.09% ~ 2.85%, with same transaction terms as non-related parties’.

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• Premium income (direct policy writing)

Premium income (direct policy	writing)
Major Management Bank of Taiwan Co., Ltd. Related party in substance Taiwan Business Bank Other related parties	From January 1 to March 31, 2021 $ 459 2,842 2,477 $ 5,778	From January 1 to March 31, 2020
			$ 4,120 - 23,618 $ 27,738

The insurances to the abovementioned related parties provide the same insurance conditions to unrelated parties.

1. Claims (direct policy writing)

Claims (direct policy writing)
Major Management Bank of Taiwan Co., Ltd. Related party in substance Goldsun Building Materials Co., Ltd. Other related parties	From January 1 to March 31, 2021 $ 23 363 3,708 $ 4,094	From January 1 to March 31, 2020
			$ 348 - - $ 348

The insurances to the abovementioned related parties provide the same claim conditions to unrelated parties.

1. Commission expenditure

Commission expenditure
Major Management Bank of Taiwan Co., Ltd. Related party in substance Bank Taiwan Insurance Brokers Co., Ltd. Taiming Assurance Broker Co., Ltd. (TABC) Other related parties	From January 1 to March 31, 2021 $ 457 7,072 2,961 2,909 $ 13,399	From January 1 to March 31, 2020
			$ 693 6,767 2,614 - $ 10,074

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The insurances to the abovementioned related parties provide the same commission conditions to unrelated parties.

1. Lessor Agreement

Operating lease

The operating leases of the Company for the investment properties have the lease period of 1 to 10 years. When the lessees exercise the right of continual lease, the rents are agreed to be adjusted based on the market price. Upon the end of the leasehold duration, the lessees are not entitled to preferential lease right over the investment properties.

The future lease payments to be received are aggregated as the following:

Type/Name of the Related Parties Major Management Yong-Shin Development Co., Ltd. Investor with significant effects Navigator Real Estate Co., Ltd. Tong-Sheng Development Co., Ltd. Navigator Investment Co., Ltd. Related party in substance Taiwan Navigator Assets Forland Auto Trade Holding Co., Ltd. Taipei Branch (Cayman) Sirtec International Co., Ltd. Taiming Assurance Broker Co., Ltd. (TABC)	March31,2021 $ 200 480 300 200 $ 1,180 700 13,306 7,908 $ 24,274	December 31, 2020 $ 220 528 330 220 $ 1,298 770 15,035 11,193 $ 29,594	March31,2020	March31,2020
				$ 310 744 465 310 $ 1,829 1,085 7,704 17,913 $ 30,360

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• (1) The details of the rents received by leasing the investment properties to

the related parties are as follows:

Major Management Yong-Shin Development Co., Ltd. Investor with significant effects Navigator Real Estate Co., Ltd. Tong-Sheng Development Co., Ltd. Navigator Investment Co., Ltd. Related party in substance Taiwan Navigator Assets Forland Auto Trade Holding Co., Ltd. Taipei Branch (Cayman) Sirtec International Co., Ltd. Taiming Assurance Broker Co., Ltd. (TABC)	From January 1 to March 31, 2021 $ 19 46 29 19 113 67 1,649 2,062 $ 4,004	From January 1 to March 31, 2020	From January 1 to March 31, 2020
			$ 19 46 29 19 113 67 1,650 2,063 $ 4,006

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• (2) The deposits the Company received for leasing properties to the related parties as of March 31, 2021, and December 31 and March 31, 2020 are as follows:

as follows:
Major Management Yong-Shin Development Co., Ltd. Investor with significant effects Navigator Real Estate Co., Ltd. Tong-Sheng Development Co., Ltd. Navigator Investment Co., Ltd. Related party in substance Forland Auto Trade Holding Co., Ltd. Taipei Branch (Cayman) Taiwan Navigator Assets Sirtec International Co., Ltd. Taiming Assurance Broker Co., Ltd. (TABC)	March31,2021 $ 20 48 30 20 70 118 1,652 1,615 $ 3,573	December 31, 2020 $ 20 48 30 20 70 118 1,652 1,615 $ 3,573	March31,2020
				$ 20 48 30 20 70 118 1,652 1,615 $ 3,573

The abovementioned property leasing to the related parties provided the transaction conditions similar to ordinary transactions.

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6. Lessee Agreement

Lessee Agreement
Type/Name of the Related Parties March Right-of-use assets Investor with significant effects Navigator Real Estate Co., Ltd. $ Lease liabilities Investor with significant effects Navigator Real Estate Co., Ltd. $ Type/Name of the Related Parties Interest expense Investor with significant effects Navigator Real Estate Co., Ltd. Total amount of cash (outflow) of lease Investor with significant effects Navigator Real Estate Co., Ltd.	March		31,2021 December 31, 2020 2,399 $ 2,960 2,526 $ 3,112 From January 1 to March 31, 2021 $ 16 $ 602	December 31, 2020	March31,2020 $ 4,641 $ 4,845 From January 1 to March 31, 2020	March31,2020
		$
		$
Interest expense Investor with significant effects Navigator Real Estate Co., Ltd. Total amount of cash (outflow) of lease Investor with significant effects Navigator Real Estate Co., Ltd.							$ 32 $ 602

Leasing properties from Navigator Real Estate Co., Ltd. that has significant effects provided the transaction conditions similar to ordinary transactions.

The Company has leased properties from Navigator Real Estate Co., Ltd. which has significant effects, the outstanding balance of paid deposit at March 31, 2021, and December 31 and March 31, 2020 were both NT$ 482 thousand.

(III) Incentive remuneration to key management level

The total salaries and remunerations to directors and other key management in January 1 to March 31, 2021 and 2020 are enumerated below:

Short-term employee benefits Post-employment benefits	From January 1 to March31,2021 $ 35,395 580 $ 35,975	From January 1 to March31,2020	From January 1 to March31,2020
			$ 37,623 576 $ 38,199

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The salaries and remunerations to directors and other key management were determined by the Salary Committee in accordance with the personal performances and trends in the markets.

XXV. Others

• (I) Gross retained earned premium

• As of March 31, 2021, the balance of the gross retained earned premium for the compulsory and non-compulsory insurance, and the calculation are as follows:

compulsory and non-compulsory insurance, and the calculation are as follows:	compulsory and non-compulsory insurance, and the calculation are as follows:	compulsory and non-compulsory insurance, and the calculation are as follows:	compulsory and non-compulsory insurance, and the calculation are as follows:	compulsory and non-compulsory insurance, and the calculation are as follows:	as follows:	as follows:	as follows:
Insurance type Premium revenues (1) Reinsurance premium revenues (2) Reinsurance premium outward (3) Premium retained (4)＝(1)＋(2)－ (3) Compulsory insurance $ 211,053 $ 61,580 $ 100,916 $ 171,717 Non-Compulsory insurance 3,227,553 34,894 533,210 2,729,237 $ 3,438,606 $ 96,474 $ 634,126 $ 2,900,954 Unearned premium reserves for directinsurance Unearned premium reserves for reinsuranceinwards Net change in unearned premium reserves Item Reserve (5) Recovery (6) Reserve (7) Recovery (8) (9)=(5)－ (6)+(7)－(8) Compulsory insurance $ 346,745 $ 348,534 $ 146,203 $ 146,159 ( $ 1,745 ) Non-Compulsory insurance 2,584,114 1,108,123 50,289 58,799 1,467,481 $ 2,930,859 $ 1,456,657 $ 196,492 $ 204,958 $ 1,465,736					Premium retained (4)＝(1)＋(2)－ (3)
						$ 171,717 2,729,237 $ 2,900,954 Net change in unearned premium reserves (9)=(5)－ (6)+(7)－(8) ( $ 1,745 ) 1,467,481 $ 1,465,736
		Reserve (7) $ 146,203 50,289 $ 196,492		Recovery (8)
				$ 146,159 58,799 $ 204,958			$ 1,745 ) 1,467,481 $ 1,465,736

Item Compulsory insurance Non-Compulsory insurance	Unearned premium reserves for ceding reinsuranceinward Reserve (10) Recovery (11) $ 208,050 $ 209,123 322,500 207,523 $ 530,550 $ 416,646	Ceding net change in unearned premium reserves (12)=(10)－(11) ( $ 1,073 ) 114,977 $ 113,904	Gross retained earned premium (13)=(4)－ (9)+(12)	Gross retained earned premium (13)=(4)－ (9)+(12)
		(		$ 172,389 1,376,733 $ 1,549,122

1. As of March 31, 2020, the balance of the gross retained earned premium for the compulsory and non-compulsory insurance, and the calculation are as follows:

Insurance type Compulsory insurance Non-Compulsory insurance	Premium revenues (1) $ 216,261 1,552,975 $ 1,769,236	Reinsurance premium revenues (2)	Reinsurance premium revenues (2)	Reinsurance premium outward (3) $ 102,763 510,184 $ 612,947	Premium retained (4)＝(1)＋(2)－ (3)	Premium retained (4)＝(1)＋(2)－ (3)
			$ 61,155 33,968 $ 95,123			$ 174,653 1,076,759 $ 1,251,412

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Item Compulsory insurance Non-Compulsory insurance Item	Unearned premium reserves for directinsurance Unearned premium reserves for reinsuranceinwards Net change in unearned premium reserves Reserve (5) Recovery (6) Reserve (7) Recovery (8) (9)=(5)－ (6)+(7)－(8) $ 344,993 $ 338,780 $ 144,987 $ 144,516 $ 6,684 1,257,134 1,053,440 48,193 55,536 196,351 $ 1,602,127 $ 1,392,220 $ 193,180 $ 200,052 $ 203,035 Unearned premium reserves for ceding reinsurance inward Ceding net change in unearned premium reserves (12)=(10)－(11) Gross retained earned premium (13)=(4)－(9)+(12) Reserve (10) Recovery (11) $ 206,999 $ 203,272 $ 3,727 $ 171,696 321,816 222,186 99,630 980,038 $ 528,815 $ 425,458 $ 103,357 $ 1,151,734	Unearned premium reserves for directinsurance Unearned premium reserves for reinsuranceinwards Net change in unearned premium reserves Reserve (5) Recovery (6) Reserve (7) Recovery (8) (9)=(5)－ (6)+(7)－(8) $ 344,993 $ 338,780 $ 144,987 $ 144,516 $ 6,684 1,257,134 1,053,440 48,193 55,536 196,351 $ 1,602,127 $ 1,392,220 $ 193,180 $ 200,052 $ 203,035 Unearned premium reserves for ceding reinsurance inward Ceding net change in unearned premium reserves (12)=(10)－(11) Gross retained earned premium (13)=(4)－(9)+(12) Reserve (10) Recovery (11) $ 206,999 $ 203,272 $ 3,727 $ 171,696 321,816 222,186 99,630 980,038 $ 528,815 $ 425,458 $ 103,357 $ 1,151,734	Unearned premium reserves for directinsurance Unearned premium reserves for reinsuranceinwards Net change in unearned premium reserves Reserve (5) Recovery (6) Reserve (7) Recovery (8) (9)=(5)－ (6)+(7)－(8) $ 344,993 $ 338,780 $ 144,987 $ 144,516 $ 6,684 1,257,134 1,053,440 48,193 55,536 196,351 $ 1,602,127 $ 1,392,220 $ 193,180 $ 200,052 $ 203,035 Unearned premium reserves for ceding reinsurance inward Ceding net change in unearned premium reserves (12)=(10)－(11) Gross retained earned premium (13)=(4)－(9)+(12) Reserve (10) Recovery (11) $ 206,999 $ 203,272 $ 3,727 $ 171,696 321,816 222,186 99,630 980,038 $ 528,815 $ 425,458 $ 103,357 $ 1,151,734
Compulsory insurance Non-Compulsory insurance			$ 171,696 980,038 $ 1,151,734

(II) Retained claims

1. As of March 31, 2021, the balance of the gross retained claims for the compulsory

and non-compulsory insurance, and the calculation are as follows:

Insurance type Compulsory insurance Non-Compulsory insurance	Claims (including the claim expenses) (1) $ 125,380 542,600 $ 667,980		Claims for reinsurance (2)		Refundable Claims for Reinsurance (3) $ 73,990 53,793 $ 127,783	Retained claims (4)＝(1)＋(2)－ (3)	Retained claims (4)＝(1)＋(2)－ (3)
			$ 61,065 14,576 $ 75,641				$ 112,455 503,383 $ 615,838

1. As of March 31, 2020, the balance of the gross retained claims for the compulsory

and non-compulsory insurance, and the calculation are as follows:

Insurance type Compulsory insurance Non-Compulsory insurance	Claims (including the claim expenses) (1) $ 138,290 531,103 $ 669,393		Claims for reinsurance (2)		Refundable Claims for Reinsurance (3) $ 79,822 120,654 $ 200,476	Retained claims (4)＝(1)＋(2)－ (3)	Retained claims (4)＝(1)＋(2)－ (3)
			$ 54,845 13,887 $ 68,732				$ 113,313 424,336 $ 537,649

• 65 -

(III) Unearned premium reserves

1. The balances of the retained unearned premium reserves for each insurance type as of March 31, 2021 are summarized as the followings:

Item Miscellaneous Insurance General Personal Automobile Liability Insurance General Personal Automobile Physical Damage Insurance Personal Accident Insurance Other Insurance (Note) Less: Accumulated impairment	Unearned premium reserves Ceding unearned premium reserves Direct business Reinsurance inward business Ceding reinsurance business $ 1,360,405 $ 197 $ 39,607 887,244 45 4,049 526,409 - 5,888 248,345 1,736 21,930 1,642,113 247,043 844,614 4,664,516 249,021 916,088 - - - $ 4,664,516 $ 249,021 $ 916,088	Unearned premium reserves Ceding unearned premium reserves Direct business Reinsurance inward business Ceding reinsurance business $ 1,360,405 $ 197 $ 39,607 887,244 45 4,049 526,409 - 5,888 248,345 1,736 21,930 1,642,113 247,043 844,614 4,664,516 249,021 916,088 - - - $ 4,664,516 $ 249,021 $ 916,088	Unearned premium reserves Ceding unearned premium reserves Direct business Reinsurance inward business Ceding reinsurance business $ 1,360,405 $ 197 $ 39,607 887,244 45 4,049 526,409 - 5,888 248,345 1,736 21,930 1,642,113 247,043 844,614 4,664,516 249,021 916,088 - - - $ 4,664,516 $ 249,021 $ 916,088	Unearned premium reserves Ceding unearned premium reserves Direct business Reinsurance inward business Ceding reinsurance business $ 1,360,405 $ 197 $ 39,607 887,244 45 4,049 526,409 - 5,888 248,345 1,736 21,930 1,642,113 247,043 844,614 4,664,516 249,021 916,088 - - - $ 4,664,516 $ 249,021 $ 916,088	Retained business
	Direct business $ 1,360,405 887,244 526,409 248,345 1,642,113 4,664,516 - $ 4,664,516
			$ 197 45 - 1,736 247,043 249,021 - $ 249,021	$ 39,607 4,049 5,888 21,930 844,614 916,088 - $ 916,088	$ 1,320,995 883,240 520,521 228,151 1,044,542 3,997,449 - $ 3,997,449

Note: the balance of each insurance type less than 5% of the total are stated collectively.

1. The balances of the retained unearned premium reserves for each insurance type as of March 31, 2020 are summarized as the followings:

Item General Personal Automobile Liability Insurance General Personal Automobile Physical Damage Insurance Personal Accident Insurance One-year Residential Fire Insurance Compulsory Automobile Liability Insurance General Commercial Automobile Liability Insurance Other Insurance (Note) Less: Accumulated impairment	Unearned premium reserves Direct business Reinsurance inward business $ 834,337 $ 41 491,150 - 251,065 1,589 175,427 - 168,331 66,499 131,981 - 1,128,672 169,828 3,180,963 237,957 - - $ 3,180,963 $ 237,957	Unearned premium reserves Direct business Reinsurance inward business $ 834,337 $ 41 491,150 - 251,065 1,589 175,427 - 168,331 66,499 131,981 - 1,128,672 169,828 3,180,963 237,957 - - $ 3,180,963 $ 237,957	Ceding unearned premium reserves Ceding reinsurance business $ 3,945 6,365 24,616 - 100,999 470 718,472 854,867 - $ 854,867		Retained business
	Direct business $ 834,337 491,150 251,065 175,427 168,331 131,981 1,128,672 3,180,963 - $ 3,180,963
					$ 830,433 484,785 228,038 175,427 133,831 131,511 580,028 2,564,053 - $ 2,564,053

Note: the balance of each insurance type less than 5% of the total are stated collectively.

• 66 -

(IV) Claim reserves

1. As of March 31, 2021, the balance of the reported but not paid and unreported claim reserves, and the calculation are as follows:

2. (1) Claim reserves and ceding claims reserves

) Claim reserve	s and ceding cla	s and ceding cla	ims reserves
Item Reported but not yet paid Not yet reported Less: Accumulated impairment	Claim r		eserves Reinsurance inward business (2) $ 331,080 160,520 - $ 491,600		Ceding claims reserves Ceding reinsurance business (3) $ 608,482 360,154 314) $ 968,322	Retained business (4)=(1)+(2)-(3)
	Direct Insurance (1)
		$ 1,656,391 905,078 - $ 2,561,469		(			$ 1,378,989 705,444 314 $ 2,084,747

• (2) Ceding net change in claims reserves and net change in ceding claims

reserves

reserves
Item Reported but not yet paid Not yet reported		DirectInsurance Reserve (1) Recovery (2) $1,656,391 $1,539,543 905,078 869,734 $2,561,469 $2,409,277		Reinsuranceinward business Reserve (3) Recovery (4) $ 331,080 $ 319,375 160,520 165,693 $ 491,600 $ 485,068			Net change in claims reserves (5)=(1)-(2)+ (3)-(4)
		Reserve (1) $1,656,391 905,078 $2,561,469			Reserve (3) $ 331,080 160,520 $ 491,600
								$ 128,553 30,171 $ 158,724

Item Reported but not yet paid Not yet reported		Cedingreinsurance business Reserve (6) Recovery (7) $ 608,482 $ 557,847 360,154 367,557 $ 968,636 $ 925,404	Cedingreinsurance business Reserve (6) Recovery (7) $ 608,482 $ 557,847 360,154 367,557 $ 968,636 $ 925,404	Ceding net change in claims reserves (8)=(6)-(7)	Ceding net change in claims reserves (8)=(6)-(7)
		Reserve (6) $ 608,482 360,154 $ 968,636
				(	$ 50,635 7,403) $ 43,232

1. As of March 31, 2020, the balance of the reported but not paid and unreported claim reserves, and the calculation are as follows:

2. (1) Claim reserves and ceding claims reserves

Item Reported but not yet paid Not yet reported Less: Accumulated impairment	Claim r	Claim r	eserves Reinsurance inward business (2) $ 324,261 167,106 - $ 491,367		Ceding claims reserves Ceding reinsurance business (3) $ 565,436 368,225 4,279 ) $ 929,382	Retained business(4)=(1)+( 2)-(3)	Retained business(4)=(1)+( 2)-(3)
	Direct Insurance (1)
		$ 1,474,429 866,828 - $ 2,341,257		(			$ 1,233,254 665,709 4,279 $ 1,903,242

• 67 -

• (2) Ceding net change in claims reserves and net change in ceding claims

• reserves

reserves
							Net change in
								claims
	Direct	Insurance		Reinsuranceinward		business		reserves
	Reserve	Recovery回		Reserve	Recovery		(5)=(1)-(2)+
Item	(1)		(2)	(3)		(4)		(3)-(4)
Reported but not	$ 1,474,429		$ 1,561,264	$ 324,261	$	287,474	( $	50,048 )
yet paid
Not yet reported	866,828		873,230	167,106		166,144	(	5,440)
	$ 2,341,257		$ 2,434,494	$ 491,367	$	453,618	($	55,488)
			Cedingreinsurance business			Ceding		net change
			Reserve	Recovery		in claims reserves
Item			(6)	(7)			(8)=(6)-(7)
Reported but not yet	paid	$	565,436	$	667,090	( $		101,654 )
Not yet reported			368,225		369,723	(		1,498)
		$	933,661	$ 1,036,813		($		103,152)

• (V) Premium deficiency reserves

• As of March 31, 2021, the balance of the premium deficiency reserves of each insurance type, and the calculation are as follows:

  • (1) Premium deficiency reserves and ceding premium deficiency reserves

Item Fishing Vessel Insurance Aviation Insurance Marine Hull Insurance	Premiumdeficiencyreserves Direct business Reinsurance inward business $ 2,654 $ 215 2,321 112 1,065 70 $ 6,040 $ 397	Premiumdeficiencyreserves Direct business Reinsurance inward business $ 2,654 $ 215 2,321 112 1,065 70 $ 6,040 $ 397	Ceding premium deficiency reserves Ceding reinsurance business $ - - - $ -		Retained business
	Direct business $ 2,654 2,321 1,065 $ 6,040
					$ 2,869 2,433 1,135 $ 6,437

• (2) Net change in premium deficiency reserves and ceding net change in premium deficiency reserves

Item Fishing Vessel Insurance Aviation Insurance Marine Hull Insurance Miscellaneous Insurance		Direct Insurance	Direct Insurance	Direct Insurance	Reinsurance inward business	Reinsurance inward business	Reinsurance inward business	Reinsurance inward business	Net change in premium deficiency reserves for direct business and reinsurance inward (5)=(1)-(2)+ (3)-(4) ( $ 119 ) ( 144) 1,135 ( 2,023) ($ 1,151)
		Reserve (1) $ 2,654 2,321 1,065 - $ 6,040		Recovery (2)		Reserve (3) $ 215 112 70 - $ 397		Recovery (4)
				$ 2,762 2,431 - 1,999 $ 7,192				$ 226 146 - 24 $ 396

• 68 -

Item Fishing Vessel Insurance Aviation Insurance Marine Hull Insurance Miscellaneous Insurance		Cedingreinsurance business Reserve (6) Recovery (7) $ - $ - - - - - - - $ - $ -	Cedingreinsurance business Reserve (6) Recovery (7) $ - $ - - - - - - - $ - $ -		Ceding net change in premium deficiency reserves (8)=(6)-(7) $ - - - - $ -	Loss recognized under the net provision of premium deficiency reserves for the period (9)=(5)-(8)	Loss recognized under the net provision of premium deficiency reserves for the period (9)=(5)-(8)
		Reserve (6) $ - - - - $ -
						( ( ( (	$ 119 ) 144 ) 1,135 2,023) $ 1,151)

The abovementioned premium deficiency reserves does not apply discount when calculating.

1. As of March 31, 2020, the balance of the premium deficiency reserves of each insurance type, and the calculation are as follows:

2. (1) Premium deficiency reserves and ceding premium deficiency reserves

Item Fishing Vessel Insurance Marine Hull Insurance Aviation Insurance Marine Cargo Insurance	Premium deficiencyreserves Direct business Reinsurance inward business $ 2,663 $ 121 1,712 34 1,489 57 1,244 13 $ 7,108 $ 225	Premium deficiencyreserves Direct business Reinsurance inward business $ 2,663 $ 121 1,712 34 1,489 57 1,244 13 $ 7,108 $ 225	Ceding premium deficiency reserves Ceding reinsurance business $ - - - - $ -		Retained business
	Direct business $ 2,663 1,712 1,489 1,244 $ 7,108
					$ 2,784 1,746 1,546 1,257 $ 7,333

• (2) Net change in premium deficiency reserves and ceding net change in premium deficiency reserves

Item Fishing Vessel Insurance Marine Hull Insurance Aviation Insurance Marine Cargo Insurance		DirectInsurance Reserve (1) Recovery (2) $ 2,663 $ 2,946 1,712 783 1,489 2,881 1,244 139 $ 7,108 $ 6,749	DirectInsurance Reserve (1) Recovery (2) $ 2,663 $ 2,946 1,712 783 1,489 2,881 1,244 139 $ 7,108 $ 6,749	Reinsuranceinward business Reserve (3) Recovery (4) $ 121 $ 234 34 66 57 103 13 2 $ 225 $ 405	Reinsuranceinward business Reserve (3) Recovery (4) $ 121 $ 234 34 66 57 103 13 2 $ 225 $ 405	Reinsuranceinward business Reserve (3) Recovery (4) $ 121 $ 234 34 66 57 103 13 2 $ 225 $ 405	Net change in premium deficiency reserves for direct business and reinsurance inward (5)=(1)-(2)+( 3)-(4)
		Reserve (1) $ 2,663 1,712 1,489 1,244 $ 7,108			Reserve (3) $ 121 34 57 13 $ 225
							( $ 396 ) 897 ( 1,438) 1,116 $ 179

• 69 -

Item Fishing Vessel Insurance Marine Hull Insurance Aviation Insurance Marine Cargo Insurance		Cedingreinsurance business Reserve (6) Recovery (7) $ - $ - - - - - - - $ - $ -	Cedingreinsurance business Reserve (6) Recovery (7) $ - $ - - - - - - - $ - $ -		Ceding net change in premium deficiency reserves (8)=(6)-(7) $ - - - - $ -	Loss recognized under the net provision of premium deficiency reserves for the period (9)=(5)-(8)	Loss recognized under the net provision of premium deficiency reserves for the period (9)=(5)-(8)
		Reserve (6) $ - - - - $ -
						( (	$ 396 ) 897 1,438 ) 1,116 $ 179

The abovementioned premium deficiency reserves does not apply discount when calculating.

• (VI) Special reserves

• As of March 31, 2021, the special reserves for the compulsory and non-compulsory insurance increase/decrease as the following:

  • (1) Special reserves - Compulsory automobile liability insurance

Item Balance - beginning Provision of the Period Recovery of the Period Balance - ending		Amount
	(	$ 913,838 16,763 4,481) $ 926,120

• (2) Special reserves - Non-Compulsory automobile liability insurance

Item				Liabi	lit	ies						Special	re	serve
		Material accidents		Hazard changes		Others		Total		Material accidents		Hazard changes		Others		Total
Balance - beginning Provision of the Period Recovery of the Period Balance - ending		$ 178,008 - ( 2,024) $ 175,984		$ 796,548 - - $ 796,548		$ 230,305 - - $ 230,305		$ 1,204,861 - ( 2,024) $ 1,202,837		$ 450,903 - - $ 450,903		$ 990,404 - ( 5,406) $ 984,998		$ 466,297 - - $ 466,297		$ 1,907,604 - ( 5,406) $ 1,902,198

Note: The recovery of the special reserves under the previous liability refers to the special reserves provided for non-compulsory automobile liability insurance before January 1, 2011.

• 70 -

• As of March 31, 2020, the special reserves for the compulsory and non-compulsory insurance increase/decrease as the following:

• (1) Special reserves - Compulsory automobile liability insurance

Item Balance - beginning Provision of the Period Recovery of the Period Balance - ending		Amount
	(	$ 928,997 7,577 8,835) $ 927,739

• (2) Special reserves - Non-Compulsory automobile liability insurance

Item				Liabili	ties						Special	re	serve
		Material accidents $ 186,099 - ( 2,023) $ 184,076		Hazard changes $ 796,548 - - $ 796,548	Others		Total		Material accidents		Hazard changes		Others		Total
Balance - beginning Provision of the Period Recovery of the Period Balance - ending					$ 230,305 - - $ 230,305		$ 1,212,952 - ( 2,023) $ 1,210,929		$ 396,144 - - $ 396,144		$ 926,829 - ( 14,062) $ 912,767		$ 412,534 - - $ 412,534		$ 1,735,507 - ( 14,062) $ 1,721,445

Note: The recovery of the special reserves under the previous liability refers to the special reserves provided for non-compulsory automobile liability insurance before January 1, 2011.

• (VII) Details of balance sheet and income/cost of compulsory automobile liability insurance

• Detailed balance sheet of compulsory automobile liability insurance

Item		Amount		Item		Amount
ASSETS	March 31, 2021	December 31, 2020	March 31, 2020	Liabilities	March 31, 2021	December 31, 2020	March 31, 2020
Cash and Bank deposits Cash Equivalents Notes receivable Premiums receivable Less benefits & claims recovered from reinsurers Due from reinsurers and ceding companies Other receivables Financial assets at fair value through other comprehensive income Ceding unearned premium reserves Ceding claims reserves Temporary paid and payment to be carried over OTHER ASSETS	$ 1,550,865 - 10,773 29,712 24,717 37,384 - - 208,050 299,974 7,594 -	$ 1,547,851 - 12,219 26,709 22,400 41,501 - - 209,123 291,759 43 -	$ 1,533,810 - 9,985 32,781 21,196 39,026 - - 206,999 270,603 2,971 -	Notes payable Claims payable Reinsurance benefits and claims payable Due to reinsurers and ceding companies Unearned premium reserves Claim reserves Special reserves Temporary received and payment to be carried over OTHER LIABILITIES	$ - - - 33,618 492,948 713,455 926,120 - 2,928	$ - - - 42,559 494,693 698,726 913,838 - 1,789	$ - - - 16,648 489,980 680,963 927,739 - 2,041
Total assets	$ 2,169,069	$ 2,151,605	$ 2,117,371	Total liabilities	$ 2,169,069	$ 2,151,605	$ 2,117,371

• 71 -

• Detailed income/cost statement of compulsory automobile liability insurance

Item	From January 1 to March 31, 2021	From January 1 to March 31, 2020
OPERATING REVENUES Premium Income (including reinsurance revenue NT$61,580 thousand and NT$61,155 thousand respectively) Less: Reinsurance premium outward Net change in unearned premium reserves Retained earned premium Interest income Total operating revenues OPERATING COSTS Claims (including claims for reinsurance NT$61,065 thousand and NT$54,845 thousand respectively) Less: Claim recovered from reinsurer Retained claims Net change in claims reserves Net change in special reserves Total operating costs	$ 229,770 ( 100,916) 672 129,526 1,725 $ 131,251 $ 186,445 ( 73,990) 112,455 6,514 12,282 $ 131,251	$ 232,424 ( 102,763) ( 2,957) 126,704 2,405 $ 129,109 $ 193,135 ( 79,822) 113,313 17,054 ( 1,258) $ 129,109

• (VIII) Acquisition Cost of Insurance Contracts

• As of March 31, 2021, the amount of the insurance contracts at each insurance

category and the calculations are as follows:

Item Miscellaneous Insurance General Personal Automobile Liability Insurance General Personal Automobile Physical Damage Insurance Other Insurance (Note)	Commission expenditure $ 400,834 48,976 33,221 101,622 $ 584,653	Fee expenditure $ - - - 27,021 $ 27,021	Reinsurance commission expenditure $ 8 - - 2,235 $ 2,243		Othercost $ - 1,030 180 2,304 $ 3,514		Total
							$ 400,842 50,006 33,401 133,182 $ 617,431

Note: the balance of each insurance type less than 5% of the total are stated collectively.

The acquisition costs of the said insurance contracts are not recognized as

deferred.

• 72 -

• As of March 31, 2020, the amount of the insurance contracts at each insurance

category and the calculations are as follows:

Item General Personal Automobile Liability Insurance General Personal Automobile Physical Damage Insurance Personal Accident Insurance Compulsory Automobile Liability Insurance One-year Residential General Fire Insurance One-year Commercial Fire Insurance Other Insurance (Note)	Commission expenditure	Commission expenditure	Fee expenditure $ - - - 18,141 - - 10,430 $ 28,571	Reinsurance commission expenditure $ - - - - - 54 2,222 $ 2,276		Othercost $ 1,000 188 25 - 2,218 - 1 $ 3,432		Total
		$ 46,725 30,622 22,133 - 13,264 13,267 51,320 $ 177,331						$ 47,725 30,810 22,158 18,141 15,482 13,321 63,973 $ 211,610

• Note: the balance of each insurance type less than 5% of the total are stated collectively.

The acquisition costs of the said insurance contracts are not recognized as deferred.

• (IX) Analysis for business profit and loss

• The amount of the profits and losses at each insurance category and the calculations during January 1 to March 31, 2021 are as follows:

  • (1) Direct Insurance

Direct Insurance
Item		Premium revenues (1) $ 138,207 454,320 75,416 239,481 73,623 51,887 105,410 113,795 61,654 2,124,813 $ 3,438,606	N	et change in unearned premium reserves (2) $ - 69,177 6,663 ) 6,111 ) 20,035 12,817 8,236 556 898 ) 1,377,053 $ 1,474,202		Acquisition Cost of Insurance Contracts (3) $ 7,979 50,006 16,439 33,401 9,088 5,739 19,723 13,538 9,142 450,133 $ 615,188	Claims (including the claim expenses) (4) $ - 212,102 13,025 147,962 28,992 17 44,131 2,105 27,907 191,739 $ 667,980	c	Net change in laims reserves (5) $ - 34,791 10,663 ) 15,306 20,406 ) 74 ) 440 66,669 1,192 ) 67,321 $ 152,192	Profit (loss) of Insurance (6)=(1)-(2)-(3)- (4)-(5)
Residential Earthquake Insurance General Personal Automobile Liability Insurance One-year Residential General Fire Insurance General Personal Automobile Physical Damage Insurance General Liability Insurance Commercial earthquake insurance Personal Accident Insurance One-year Commercial General Fire Insurance Compulsory Motorcycle Liability Insurance Other Insurance (Note)			( ( (					( ( ( (			$ 130,228 88,244 63,278 48,923 35,914 33,388 32,880 30,927 26,695 38,567 $ 529,044

• 73 -

(2) Reinsurance assumed

Insurance type Residential Earthquake Insurance Compulsory Automobile Liability Insurance Commercial earthquake insurance Typhoon and Flood Insurance Marine Hull Insurance Compulsory Commercial Automobile Liability Insurance Nuclear Energy Insurance Engineering Insurance Fishing Vessel Insurance Other Insurance (Note)		Reinsurance premium revenues (1) $ 19,102 34,978 599 803 63 6,117 851 7,173 558 26,230 $ 96,474		Net change in unearned premium reserves (2) $ 3,009 29 2,979 ) 1,688 ) 678 ) 69 991 ) 736 605 ) 5,368 ) $ 8,466 )		Reinsurance commission expenditure (3) $ - - 1 ) 3 ) - - - 2,058 82 107 $ 2,243		Claims for reinsurance (4) $ - 38,334 - 44 2,070 6,742 - 3,979 188 24,284 $ 75,641	c	Net change in laims reserves (5) $ - 16,138 ) 101 ) 125 ) 3,543 ) 2,528 ) 44 1,050 ) 394 ) 30,367 $ 6,532	Profit (loss) of reinsurance inward (6)=(1)-(2)-(3)- (4)-(5)	Profit (loss) of reinsurance inward (6)=(1)-(2)-(3)- (4)-(5)
			( ( ( ( ( ( (		( (				( ( ( ( ( ( (		(	$ 16,093 12,753 3,680 2,575 2,214 1,834 1,798 1,450 1,287 23,160 ) $ 20,524

(3) Ceding reinsurance business

Insurance type Residential Earthquake Insurance Commercial earthquake insurance General Liability Insurance Typhoon, Flood and Fire Insurance Compulsory Motorcycle Liability Insurance Fishing Vessel Insurance Other Insurance (Note)		Reinsurance premium outward (1) $ 138,207 45,541 39,755 23,988 29,618 12,226 344,791 $ 634,126		Ceding net change in unearned premium reserves (2) $ - 16,718 11,422 7,161 538 ) 1,464 ) 80,605 $ 113,904	i	Reinsurance commission ncome and fee income (3) $ 14,143 1,695 9,435 1,311 - 1,867 50,359 $ 78,810		Refundable Claims for Reinsurance (4) $ - - 15,991 18 16,469 333 94,972 $ 127,783	c	Ceding net change in laims reserves (5) $ - 184 ) 13,072 ) 210 ) 954 ) 2,189 ) 59,841 $ 43,232	Loss (profit) of Ceding reinsurance (6)=(1)-(2)-(3)- (4)-(5)	Loss (profit) of Ceding reinsurance (6)=(1)-(2)-(3)- (4)-(5)
			( (						( ( ( ( (			$ 124,064 27,312 15,979 15,708 14,641 13,679 59,014 $ 270,397

  - Note: the balance of each insurance type less than 5% of the total are stated collectively.

1. The amount of the profits and losses at each insurance category and the calculations during January 1 to March 31, 2020 are as follows:

2. (1) Direct Insurance

Direct Insurance
Item Residential Earthquake Insurance General Personal Automobile Liability Insurance General Personal Automobile Physical Damage Insurance One-year Commercial General Fire Insurance General Liability Insurance One-year Residential General Fire Insurance Marine Hull Insurance Personal Accident Insurance Other Insurance (Note)		Premium revenues (1) $ 139,678 447,902 229,366 109,822 68,631 75,220 15,046 111,380 572,191 $ 1,769,236		Net change in unearned premium reserves (2) $ - 89,896 713 1,776 ) 14,967 2,652 ) 4,834 9,523 94,402 $ 209,907		Acquisition Cost of Insurance Contracts (3) $ 8,443 47,725 30,810 13,267 7,703 15,481 132 22,158 63,615 $ 209,334	Claims (including the claim expenses) (4) $ 1,700 188,304 130,302 36,528 23,463 4,853 ( 24,474 ) 45,235 263,482 $ 669,393	c	Net change in laims reserves (5) $ - 21,966 1,647 ) 67 29,065 ) 6,574 9,761 ) 7,834 ) 73,537 ) $ 93,237 )	Profit (loss) of Insurance (6)=(1)-(2)-(3)- (4)-(5)
			( (				(	( ( ( ( ( (			$ 129,535 100,011 69,188 61,736 51,563 50,964 44,315 42,298 224,229 $ 773,839

• 74 -

(2) Reinsurance assumed

Insurance type Residential Earthquake Insurance Typhoon and Flood Insurance Commercial earthquake insurance Nuclear Energy Insurance Foreign Inward Reinsurance - Aviation insurance General Liability Insurance Fishing Vessel Insurance Marine Hull Insurance Personal Accident Insurance Bonding Insurance Other Insurance (Note)		Reinsurance premium revenues (1) $ 18,543 697 1,330 712 - 136 365 109 936 460 71,835 $ 95,123		Net change in unearned premium reserves (2) $ 2,824 1,468 ) 1,220 ) 1,132 ) - 2,861 ) 776 ) 321 ) 28 185 2,131 ) $ 6,872 )		Reinsurance commission expenditure (3) $ - 3 61 - - - 53 2 - - 2,157 $ 2,276		Claims for reinsurance (4) $ 195 490 83 - 391 ) 2,007 2,578 - 55 1 63,714 $ 68,732	c	Net change in laims reserves (5) $ 194 ) 1,348 ) 156 ) 110 ) 1,022 ) 331 ) 2,454 ) 514 ) - 101 ) 43,979 $ 37,749	Profit (loss) of reinsurance inward (6)=(1)-(2)-(3)- (4)-(5)	Profit (loss) of reinsurance inward (6)=(1)-(2)-(3)- (4)-(5)
			( ( ( ( ( ( ( (				(		( ( ( ( ( ( ( ( (		( (	$ 15,718 3,020 2,562 1,954 1,413 1,321 964 942 853 375 35,884 ) $ 6,762 )

(3) Ceding reinsurance business

Insurance type Residential Earthquake Insurance Marine Hull Insurance General Liability Insurance Commercial earthquake insurance One-year Commercial General Fire Insurance Compulsory Automobile Liability Insurance Other Insurance (Note)		Reinsurance premium outward (1) $ 139,678 15,956 36,707 44,475 94,439 63,755 217,937 $ 612,947		Ceding net change in unearned premium reserves (2) $ - 6,001 7,242 15,432 16,342 2,027 56,313 $ 103,357	i	Reinsurance commission ncome and fee income (3) $ 14,115 801 7,661 1,353 26,593 - 23,122 $ 73,645		Refundable Claims for Reinsurance (4) $ - 22,317 ) 14,964 2,506 40,308 52,514 112,501 $ 200,476	c	Ceding net change in laims reserves (5) $ - 7,195 ) 21,279 ) 1,988 ) 6,778 ) 7,812 ) 58,100 ) $ 103,152 )	Loss (profit) of Ceding reinsurance (6)=(1)-(2)-(3)- (4)-(5)	Loss (profit) of Ceding reinsurance (6)=(1)-(2)-(3)- (4)-(5)
							(		( ( ( ( ( ( (			$ 125,563 38,666 28,119 27,172 17,974 17,026 84,101 $ 338,621

Note: the balance of each insurance type less than 5% of the total are stated collectively.

(X) Non-insurance assets acquired by executing recovery rights - residuals taken over and right for pursuit of recovery

right for pursuit of recovery
Credit Insurance Miscellaneous Insurance Bonding Insurance Personal Comprehensive Insurance General Liability Insurance Engineering Insurance	March 31, 2021		December 31, 2020 $ 31,580 610 2,148 48 11 1 $ 34,398	March 31, 2020
		$ 31,335 602 2,048 48 11 1 $ 34,045			$ 35,791 2,065 2,153 48 11 1 $ 40,069

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(XI) Requirements for Asset Segmentation for Certain Assets

The Company has an operation for compulsory automobile liability insurance (“the insurance”), and the insurance has an independent accounting based on the “Compulsory Automobile Liability Insurance Act”, to record the operation and financial position of the insurance.

FSC issued Jin-Guan-Bao-Chan-Zi No. 10202530301 to amend “Regulations for the Management of the Various Reserves for Compulsory Automobile Liability Insurance” on December 31, 2013, and enforced the regulations on January 1, 2014.

Based on Article 5 of the “Regulations for the Management of the Various Reserves for Compulsory Automobile Liability Insurance”, the special reserves provided for the insurance shall be deposited in financial institutions via the purchase of treasury bills or in the format of time deposit. However, with the approval of the competent authorities, the following domestic negotiation securities may be purchased:

1. Government bond. Exchangeable government bonds are excluded.

2. Financial bonds, NCD, bank's acceptance bill, and commercial papers guaranteed by financial institutions. But the financial bonds are limited to the general financial bonds.

The treasury bills purchased and the amount of time deposits in financial institution specified previously, shall not be lower than 30% of the total amount of retained earned pure premiums audited or reviewed by CPA of the latest period. The competent authorities may properly raise the percentage depending on the operation status of the Company.

Shall the balance of the special reserves not meet 30% of the total amount of retained earned pure premiums audited or reviewed by CPA of the latest period, all the reserves shall purchase treasury bills or have been deposited in financial institutions as time deposits.

According to Article 6 of the “Regulations for the Management of the Various Reserves for Compulsory Automobile Liability Insurance”, the funds held by the insurance (various reserves, payables, temporary receipts and payment to be carried over), shall be deposited in the banks as demand deposits and time deposits, except the special reserve, which should be handled in accordance with said requirements. However, with the approval of the competent authorities, the following domestic negotiation securities may be purchased:

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• Treasury Bills.

• NCD, bank's acceptance Bill, and commercial papers guaranteed by financial institutions.

• Repo Government Bonds.

The amount of time deposits in financial institution specified previously, shall not be lower than 45% of the balance of funds held by the insurance minus special reserves, and 30% of the amount of retained earned pure premiums audited or reviewed by CPA of the latest period. The competent authorities may properly raise the percentage depending on the operation status of the Company.

Shall the sum of the unearned premium reserves and claim reserves not meet 30% of the total amount of retained earned pure premiums audited or reviewed by CPA of the latest period, all the reserves shall be deposited in financial institutions as time deposits.

Based on Article 11 of the “Regulations for the Management of the Various Reserves for Compulsory Automobile Liability Insurance”, when a non-life insurance enterprise suspends or cease to provide the said insurance, all the reserves of the insurance shall be transferred and included to the reserve provisions of the non-life insurance enterprise succeeding the business.

Where an insurance enterprise is ordered to suspend business and undergo rehabilitation, ordered to dissolve, or its permit to provide the insurance is abrogated but no other insurer takes over the insurance business, and the liabilities of the insurance are terminated with positive balance of special reserves, the corresponding assets of such special reserves shall be transferred to Motor Vehicle Compensation Fund Accident.

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XXVI. Claim Liabilities to Policyholders

• (I) As of March 31, 2021, the information of the claim liabilities to the policyholders by the Company is summarized as the following:

• The claim liabilities reported and paid, reported but not paid, and unreported to the policyholders

Item General Personal Automobile Liability Insurance Compulsory Automobile Liability Insurance One-year Commercial Fire Insurance General Personal Automobile Physical Damage Insurance Compulsory Motorcycle Liability Insurance Marine Cargo Insurance Other Insurance (Note)	Claims payable Reported and paid $ - - - - - - 74 $ 74		Claim reserves
		Reported but not yet paid $ 565,461 74,403 227,351 168,468 78,515 131,367 741,906 $ 1,987,471	Not yetreported $ 129,580 342,492 16,735 46,310 133,212 49,071 348,198 $ 1,065,598		Total
					$ 695,041 416,895 244,086 214,778 211,727 180,438 1,090,104 $ 3,053,069

1. Reinsurance reserve assets - Claim recoverable from reinsurers to the reported and paid claims to the policyholders

Insurance type Compulsory Automobile Liability Insurance General Liability Insurance Compulsory Motorcycle Liability Insurance Engineering Insurance Compulsory Commercial Automobile Liability Insurance Marine Cargo Insurance Personal Accident Insurance General Personal Automobile Physical Damage Insurance Commercial Comprehensive Insurance Commercial earthquake insurance Professional Liability Insurance Other Insurance (Note) Allowance loss		Claimpaid $ 16,018 6,905 4,737 4,045 3,962 3,871 1,804 1,131 185 134 90 41,466 ) 1,416 7 ) $ 1,409	Reported and paid $ - - - - - - - - - - - 4 4 - $ 4		Total
	( (			( (	$ 16,018 6,905 4,737 4,045 3,962 3,871 1,804 1,131 185 134 90 41,462 ) 1,420 7 ) $ 1,413

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• Reinsurance reserve assets - Claim recoverable from reinsurers to the reported

but not paid and unreported ceding claims to the policyholders

Insurance type Compulsory Automobile Liability Insurance One-year Commercial Fire Insurance Marine Cargo Insurance Marine Hull Insurance Engineering Insurance Compulsory Motorcycle Liability Insurance Other Insurance (Note) Accumulated impairment	Reported but not yet paid $ 38,362 149,554 111,309 66,854 63,504 10,270 168,629 $ 608,482	Not yetreported $ 156,539 6,600 38,700 17,000 3,700 54,313 83,302 $ 360,154		Total
			(	$ 194,901 156,154 150,009 83,854 67,204 64,583 251,931 968,636 314) $ 968,322

Note: the balance of each insurance type less than 5% of the total are stated collectively.

• (II) As of December 31, 2020, the information of the claim liabilities to the policyholders by the Company is summarized as the following:

• The claim liabilities reported and paid, reported but not paid, and unreported to the policyholders

Item General Personal Automobile Liability Insurance Compulsory Automobile Liability Insurance General Personal Automobile Physical Damage Insurance Compulsory Motorcycle Liability Insurance Marine Cargo Insurance One-year Commercial Fire Insurance Other Insurance (Note)	Claims payable Reported and paid $ - - - - - - - $ -		Claim reserves
		Reported but not yet paid $ 530,387 76,774 157,333 58,008 129,741 153,074 753,601 $ 1,858,918	Not yet reported $ 129,758 343,605 42,139 135,908 50,195 14,173 319,649 $ 1,035,427		Total
					$ 660,145 420,379 199,472 193,916 179,936 167,247 1,073,250 $ 2,894,345

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• Reinsurance reserve assets - Claim recoverable from reinsurers to the reported

and paid claims to the policyholders

Insurance type Marine Cargo Insurance Compulsory Automobile Liability Insurance Engineering Insurance General Liability Insurance Compulsory Commercial Automobile Liability Insurance Compulsory Motorcycle Liability Insurance Personal Accident Insurance One-year Commercial General Fire Insurance Other Insurance (Note) Allowance loss		Claim paid $ 21,591 15,273 4,828 4,717 $ 3,878 3,249 2,556 1,611 36,516) 21,187 106) $ 21,081	Reported and paid $ - - - - $ - - - - - - - $ -		Total
	( (			( (	$ 21,591 15,273 4,828 4,717 $ 3,878 3,249 2,556 1,611 36,516) 21,187 106) $ 21,081

1. Reinsurance reserve assets - Claim recoverable from reinsurers to the reported but not paid and unreported ceding claims to the policyholders

Insurance type Compulsory Automobile Liability Insurance Marine Cargo Insurance One-year Commercial Fire Insurance Marine Hull Insurance Compulsory Motorcycle Liability Insurance Engineering Insurance General Liability Insurance Other Insurance (Note) Accumulated impairment		Reported but not yet paid $ 31,792 109,141 95,535 67,023 10,529 60,203 34,985 148,639 $ 557,847		Not yet reported $ 155,654 39,600 5,700 22,500 55,007 3,300 16,600 69,196 $ 367,557		Total
					(	$ 187,446 148,741 101,235 89,523 65,536 63,503 51,585 217,835 925,404 314) $ 925,090

Note: the balance of each insurance type less than 5% of the total are stated collectively.

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• (III) As of March 31, 2020, the information of the claim liabilities to the policyholders by

the Company is summarized as the following:

1. The claim liabilities reported and paid, reported but not paid, and unreported to the policyholders

Item General Personal Automobile Liability Insurance Compulsory Automobile Liability Insurance One-year Commercial Fire Insurance Compulsory Motorcycle Liability Insurance General Personal Automobile Physical Damage Insurance Marine Hull Insurance Other Insurance (Note)	Claims payable Reported and paid $ - - - - 1 - 1,055 $ 1,056		Claim reserves
		Reported but not yet paid $ 466,693 68,445 214,647 70,357 143,509 114,525 720,514 $ 1,798,690	Not yetreported $ 126,088 337,098 14,145 132,745 39,966 50,693 333,199 $ 1,033,934		Total
					$ 592,781 405,543 228,792 203,102 183,475 165,218 1,053,713 $ 2,832,624

1. Reinsurance reserve assets - Claim recoverable from reinsurers to the reported and paid claims to the policyholders

Insurance type Fishing Vessel Insurance Compulsory Automobile Liability Insurance General Liability Insurance Engineering Insurance Compulsory Commercial Automobile Liability Insurance Commercial earthquake insurance Other Insurance (Note) Allowance loss		Claimpaid $ 61,071 13,416 11,117 6,593 5,064 3,882 27,352) 73,791 369) $ 73,422	Reported and paid $ - - 3 - - - - 3 - $ 3		Total
	( (			( (	$ 61,071 13,416 11,120 6,593 5,064 3,882 27,352) 73,794 369) $ 73,425

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• Reinsurance reserve assets - Claim recoverable from reinsurers to the reported

but not paid and unreported ceding claims to the policyholders

Insurance type Compulsory Automobile Liability Insurance One-year Commercial Fire Insurance Marine Hull Insurance Marine Cargo Insurance Fishing Vessel Insurance Compulsory Motorcycle Liability Insurance Engineering Insurance Other Insurance (Note) Accumulated impairment	Reported but not yet paid $ 25,356 149,632 97,215 42,030 52,935 8,065 44,093 146,110 $ 565,436	Not yetreported $ 151,725 5,800 30,100 36,700 17,200 53,868 6,300 66,532 $ 368,225		Total
			(	$ 177,081 155,432 127,315 78,730 70,135 61,933 50,393 212,642 933,661 4,279) $ 929,382

Note: the balance of each insurance type less than 5% of the total are stated collectively.

XXVII. Effects from Changes of Estimates and Assumptions

• (I) The estimate amount of claims for the following significant claim events, is the neutral estimation for the current forecast of future amount of claim, based on the inspection of the insurance accidents. However, the estimation and assumption are uncertain, and may not be consistent to the actual claim outcomes in the future. The said estimation may be revised due to re-evaluation of the case by the insurance notary or the claim personnel after inspection and collection of information; or may be modified because the delegated attorneys change the future claim amount specified in the arising litigation and related legal fees. The Company will re-evaluated and account based on the said changes, and cause the estimated claim amount of the claim event. The changed amount will directly affect the profit/loss of the current when changes occur. The estimation of the amount of each insurance type and the amount after changes are listed as follows:

• From January 1 to March 31, 2021

Insurance type One-year Commercial General Fire Insurance Cargo Insurance Aviation Insurance	Estimated amount $ 135,315 44,670 30,190 $ 210,175	Amount after changes
		$ 135,315 44,670 30,190

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The abovementioned effects do not take into account of ceding reinsurance.

1. From January 1 to March 31, 2020

Insurance type One-year Commercial General Fire Insurance Fishing Vessel Insurance Aviation Insurance Marine Hull Insurance	Estimated amount $ 118,979 100,999 30,190 27,524 $ 277,692	Amount after changes
		$ 118,979 52,570 30,190 23,884

The abovementioned effects do not take into account of ceding reinsurance.

• (II) The Company evaluates the premium deficiency reserve based on the expected cost method, while considering the individual cases not satisfying Article 10 of the “Regulations Governing Insurance Enterprises Engaging in Operating Reinsurance and Other Risk Spreading Mechanisms” However, the estimation and assumption are uncertain, and may not be consistent to the actual loss rate and actual general fee rate in the future. The said estimation may, due to the changes of future economic situations, cause the provision of premium deficiency reserve to increase or decrease. When the expected loss rate increases of decrease 5%, the amount of the provision of premium deficiency reserve for the period of January 1 to March 31 2021 and 2020 may increase NT$617 thousand or NT$461 thousand, or decrease NT$231 thousand or NT$461 thousand, respectively. The changed amount will directly affect the profit/loss of the period when changes occur. The abovementioned effects do not take into account of ceding reinsurance.

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XXVIII. Information of risk management

• (I) Structure, Organization, and Authorities and Responsibilities of Risk Management

• Structure and Organization of Risk Management

==> picture [422 x 310] intentionally omitted <==

In order to effectively plan, supervise and execute the risk management, in the 29th meeting of the 22nd Board of Directors on September 24, 2010, the Risk Management Committee was set up under the Board.

Risk management strategies of the Company:

• (1) The standards of risk management established by Company include: insurance risk, credit risk, market risk, liquidity risk, operation risk and risk of match for asset and liability.

• (2) Based on the operational plan and target of financial incomes, the risk appetite of the Company is set up as no less than 400% of the capital adequacy ratio.

• (3) Establish the risk management procedures consistent of the business scale, nature, and complexity of the Company, so each risk is controlled to the acceptable extent.

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• (4) Effectively control the capital adequacy ratio by complying with the regulations of managing capital adequacy ratio by the competent authorities.

• (5) Establish the information security guarding mechanism and contingency plan for the business or transactions, and inter-application of information.

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Risk management procedure of the Company:

To identify, measure, supervise and monitor each risk faced by the Company, the risk management procedure is divided as five stages, namely risk identification, risk measurement, risk response, risk control, and risk report, as for the operation of risk management.

1. The functions of each unit are as follows:

2. (1) Board of Directors

   • A. Recognize the risks to be assumed for the operations of insurance enterprise, ensure to effectiveness of the risk management, and be ultimately responsible for the risk management as a whole.

   • B. Must establish the proper risk management mechanism and culture, approve the proper risk management policies and review them regularly, and optimize the allocations of resources.

   • C. Not only pay attentions to the risks assumed by individual unit, but rather consider the effects from the aggregation of each risk at the company level. Meanwhile, the mandatory capitals required by the competent authorities, and various regulations of finance and business impacting the capital allocation shall be taken into account.

3. (2) Risk Management Committee

   • A. Draft the policies, structures, organizational functions of risk management, establish the qualified and quantified management standards, report to the Board regularly and reflect the implementation of risk management to the Board in timely manner, and propose the necessary improvement advices.

   • B. Execute the Board’s decisions of risk management, and regularly review the performance for development, establishment, and execution of the risk management mechanism at the Company level.

   • C. Assist and supervise the risk management activities conducted by each department.

   • D. Adjusted the risk categories, limit allocation, and assumption approach depending on the changes of circumstance.

   • E. Coordinate the interactions and communications of cross-department risk management.

4. 86 -

5. (3) Risk Management Dept.

6. A. Charge of the executions of daily risk monitor, measurement, and evaluation, and independent from the business to perform the duties.

7. B. Risk management department shall perform the following duties based on the categories of operations:

   • a. Assisting to draft and execute the risk management policies approved by the Board of Directors.

   • b. Assisting to draft the risk limits based on the risk appetite.

   • c. Compiling the risk information provided by each unit, to coordinate and communicate among them for the purpose of executing policies and limits.

   • d. Providing the risk management related report regularly.

   • e. Monitoring the risk limits and utilization of each business unit.

   • f. Assisting to the stress test.

   • g. Conducting backtracking test when necessary.

   • h. Other matters related to risk management.

8. C. Handling the breach of risk limits by other units under the authorization of the Risk Management Committee.

9. (4) Business units (all departments other than Audit Dept. and Risk Management Dept.)

10. A. The heads of business units’ duties to execute the risk management are as follows:

    • a. Charge of the management and report of the daily risks for the unit he/she belongs to, and taking the necessary responding strategies.

    • b. Supervising the regular conveyance of related risk information to the Risk Management Dept.

11. B. Business units’ duties to execute the risk management are as follows:

    • a. Identifying risks and reporting the exposures.

    • b. Measuring the extent (quantifying or qualifying) of impact when such risks materialize, and convey the risk information in a timely and correct manner.

    • c. Reviewing each risks and limit regularly, to ensure the risk limit of the unit is effectively executed.

12. 87 -

13. d. Monitoring the risk exposure and report the breaches, including the measures taken for such breaches.

14. e. Assisting the development of the risk models, to ensure the measurement of risk, use of model, and establishment of assumptions within the business unit is on the reasonable and consistent basis.

15. f. Ensuring the effective execution of the internal control within the business unit, to comply with the laws and regulations as well as the risk management policies of the Company.

16. g. Assisting the collection of the operational risks.

17. (5) Audit Dept.

Based on the current laws and regulations to audit the execution of risk management for business units of the Company.

• (II) The extent and nature of the risk reporting and measuring system for the non-life insurance enterprises

The Risk Management Dept. compiles the risk information provided by each unit, to prepare the risk management report regularly, as well as reviews and tracks the utilization of major risk limits, to monitor the risk regularly. The risk management report is submitted to the Risk Management Committee every quarter, and the holistic risk management report is submitted to the Board of Director every six months.

The insurance risk management information system of the Company has the database for the accumulations under the same insurance for each category of insurance, and the limit control for each policy. The database not only is able to control the significant disaster risk timely, but also helpful for the business units to conduct scenario analysis and the stress tests. The limit control for each policy includes the real-time ceding reinsurance, to control the risks of significant disaster and reinsurances effectively.

(III) The procedures for non-life insurance enterprises to sustain, measure, supervise, and control the insurance risks, and to ensure the insurance-approval policies for proper risk categorization and premium levels

When the sales of each insurance of the Company solicit business, the “Regulations Governing Business Solicitation” of the Company shall be followed. The insurance approver of each insurance shall be strictly required for their

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qualification, authorities and duties based on the “Regulations Governing Insurance Approval and Claims”, and they shall follow the established operational process of insurance approval for the insurance type when approving insurance, to ensure the proper risk categorization and premium levels, as well as to control the insurance risks.

• (IV) Evaluating and managing the insurance risk extent on the basis of company as a whole

For the management of insurance risks, the Company has the risks of product design and pricing, insurance approval, reinsurance, significant disaster, claim, reserves, as well as the matching risks for assets and liabilities.

• (V) The approaches used by the non-life insurance enterprises to limit the insurance risk exposures and prevent the risk of undue concentration:

The Company has, based on the “Regulations Governing Insurance Enterprises Engaging in Operating Reinsurance and Other Risk Spreading Mechanisms”, to established a risk management mechanism for the retained and ceding reinsurance and reinsurance inwards business; and the “Reinsurance Risk Management Operating Guidelines” has been established for execution by considering the ability to assume risks. The retained limits of insurance for each hazard unit of each insurance type are disclosed as the following:

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March 31, 2021

Insurance type One-year Commercial Fire Insurance One-year Residential Fire Insurance and Allied Perils Insurance Marine Cargo Insurance Inland Marine Insurance Marine Hull Insurance (casualty insurance of crews and passengers) Marine Hull Insurance (other than the casualty insurance of crews and passengers) Fishing Vessel Insurance Aviation Insurance Engineering Insurance Credit Insurance Bonding Insurance General Liability Insurance Professional Liability Insurance Commercial Comprehensive Insurance Miscellaneous Insurance Personal Comprehensive Insurance Personal Accident Insurance Health Insurance Automobile Physical Damage Insurance and Allied Perils Insurance Automobile Liability Insurance

Unit: NT$ thousand Highest retention NT$ 1,500,000 NT$ 480,000 US$ 5,000 US$ 1,000 US$ 25,000 US$ 5,000 US$ 1,500 US$ 3,000 NT$ 1,500,000 NT$ 300,000 NT$ 300,000 NT$ 300,000 NT$ 300,000 NT$ 1,200,000 NT$ 1,200,000 NT$ 40,000 NT$ 40,000 NT$ 10,000 NT$ 30,000 NT$ 200,000

Note: the special businesses are not subjected to the above restrictions for the maximum self-retained amount.

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December 31, 2020

December 31, 2020
Insurance type One-year Commercial Fire Insurance One-year Residential Fire Insurance and Allied Perils Insurance Marine Cargo Insurance Inland Marine Insurance Marine Hull Insurance (casualty insurance of crews and passengers) Marine Hull Insurance (other than the casualty insurance of crews and passengers) Fishing Vessel Insurance Aviation Insurance Engineering Insurance Credit Insurance Bonding Insurance General Liability Insurance Professional Liability Insurance Commercial Comprehensive Insurance Miscellaneous Insurance Personal Comprehensive Insurance Personal Accident Insurance Health Insurance Automobile Physical Damage Insurance and Allied Perils Insurance Automobile Liability Insurance	Unit: NT$ thousand Highest retention
	NT$ 1,500,000 NT$ 480,000 US$ 5,000 US$ 1,000 US$ 25,000 US$ 3,000 US$ 1,200 US$ 3,000 NT$ 1,500,000 NT$ 300,000 NT$ 300,000 NT$ 300,000 NT$ 300,000 NT$ 1,200,000 NT$ 1,200,000 NT$ 40,000 NT$ 40,000 NT$ 10,000 NT$ 30,000 NT$ 120,000

Note: the special businesses are not subjected to the above restrictions for the maximum self-retained amount.

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March 31, 2020

Unit: NT$ thousand

	Unit: NT$ thousand
Insurance type One-year Commercial Fire Insurance One-year Residential Fire Insurance and Allied Perils Insurance Marine Cargo Insurance Inland Marine Insurance Marine Hull Insurance (casualty insurance of crews and passengers) Marine Hull Insurance (other than the casualty insurance of crews and passengers) Fishing Vessel Insurance Aviation Insurance Engineering Insurance Credit Insurance Bonding Insurance General Liability Insurance Professional Liability Insurance Commercial Comprehensive Insurance Miscellaneous Insurance Personal Comprehensive Insurance Personal Accident Insurance Health Insurance Automobile Physical Damage Insurance and Allied Perils Insurance Automobile Liability Insurance	Highest retention
	NT$ 1,500,000 NT$ 480,000 US$ 5,000 US$ 1,000 US$ 25,000 US$ 3,000 US$ 1,200 US$ 3,000 NT$ 1,500,000 NT$ 300,000 NT$ 300,000 NT$ 300,000 NT$ 300,000 NT$ 1,200,000 NT$ 1,200,000 NT$ 40,000 NT$ 40,000 NT$ 10,000 NT$ 30,000 NT$ 120,000

Note: the special businesses are not subjected to the above restrictions for the maximum self-retained amount.

• (VI) Approaches of Managing Assets and Liabilities

When implementing various business, the case officers shall manage and monitor the potential risks in the day-to-day operations based on the internal control procedures and SOP, to prevent the mismatch between the cash flows from liabilities and assets caused by the behaviors of policyholders.

(VII) When certain events occur, the non-life insurance enterprises have to assume extra liabilities or input extra commitments of owner’s equity. The procedures for management, supervision, and control

According to the Insurance Act, for the non-life insurance enterprises, the ratio of total adjusted net capital to risk-based capital may not be lower than 200%. Fail to meet the said ratio, the profits are not to be distributed; also, the capital-increase shall

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be conducted within a certain period upon the requests from the competent authorities, or the scope of operations or fund application shall be limited.

Based on the risk appetite regulated by the Risk Management Policy of the Company, the ratio of total adjusted net capital to risk-based capital may not be lower than 400%.

(VIII) Explanation of the Insurance Risk Concentration

The insurances sold by the Company include: fire insurance, marine cargo insurance, marine hull insurance, aviation insurance, personal accident insurance, automobile insurance, cash insurance, credit insurance, engineering insurance, liability insurance, health insurance, and other property insurances; the major sources of business are from within the Republic of China, and the insurance contract taken do not significantly differ from different regions.

The premium incomes for the Company mainly concentrate at automobile insurance, fire insurance, marine cargo insurance, personal accident insurance, and liability insurance.

Various reserves are provided based on the “Regulations on Provision of Various Reserves for Insurance Enterprises” and other official orders and letters.

(IX) The Sensitivities of Insurance Risks

Year From January 1 to March 31, 2021 From January 1 to March 31, 2020	The impact to the profit/loss when the expected loss ratio increase5% Before holding the reinsurance After holding the reinsurance ($ 86,785) ($ 71,085) ($ 67,065) ($ 51,765)	The impact to the profit/loss when the expected loss ratio increase5% Before holding the reinsurance After holding the reinsurance ($ 86,785) ($ 71,085) ($ 67,065) ($ 51,765)	Unit: NT$ thousand The impact to the profit/loss when the expected loss ratio decrease5% Before holding the reinsurance After holding the reinsurance $ 84,135 $ 67,935 $ 64,640 $ 49,140	Unit: NT$ thousand The impact to the profit/loss when the expected loss ratio decrease5% Before holding the reinsurance After holding the reinsurance $ 84,135 $ 67,935 $ 64,640 $ 49,140
	Before holding the reinsurance ($ 86,785) ($ 67,065)		Before holding the reinsurance $ 84,135 $ 64,640
	( (	( (

Note: the compulsory automobile insurance, nuclear energy insurance and residential earthquake insurance are excluded.

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(X) Development Trend of Claims

1. The development trend of claims during January 1 to March 31, 2021 are as the followings:

Unit: NT$ thousand

Year/Month of the Accident 2017 2018 2019 2020 2021	Incurred accumulated claims (claim expenses included)	Incurred accumulated claims (claim expenses included)	Incurred accumulated claims (claim expenses included)	Incurred accumulated claims (claim expenses included)	Incurred accumulated claims (claim expenses included)
	12 $ 2,013,877 2,239,137 2,136,349 2,288,237 534,182	24 $ 2,087,243 2,298,119 2,204,071 2,403,371	36 $ 2,073,409 2,263,292 2,206,843	48 $ 2,070,556 2,260,500	60
					$ 2,070,959

Note: the compulsory automobile insurance, nuclear energy insurance and residential earthquake insurance are excluded.

1. The development trend of claims during January 1 to March 31, 2020 are as the followings:

Unit: NT$ thousand

Year/Month of the Accident 2016 2017 2018 2019 2020	Incurred accumulated claims (claim expenses included)	Incurred accumulated claims (claim expenses included)	Incurred accumulated claims (claim expenses included)	Incurred accumulated claims (claim expenses included)	Incurred accumulated claims (claim expenses included)
	12 $ 2,503,104 2,013,877 2,239,137 2,136,349 414,004	24 $ 2,499,139 2,087,243 2,298,082 2,236,865	36 $ 2,452,145 2,073,409 2,282,754	48 $ 2,417,893 2,074,836	60
					$ 2,416,831

Note: the compulsory automobile insurance, nuclear energy insurance and residential earthquake insurance are excluded.

XXIX. Information of Foreign Currency Assets and Liabilities with Material Impacts

The following information is the consolidated expression of the foreign currencies other than the functional currency of the Company. The disclosed exchange rate refers to the exchange rate translating such foreign currencies to the functional currency. The foreign currency assets and liabilities with material impacts:

Unit: (Foreign currency / NT$ thousand)

Foreign currency assets	M	arch 31, 202	1	De	cember 31, 2	020	M	arch 31, 202	0
	Foreign Currency	Exchange rate	Carrying Amount	Foreign Currency	Exchange rate 28.48 4.31 28.48	Carrying Amount	Foreign Currency	Exchange rate	Carrying Amount
	$ 30,782 56,295 451	28.53 4.34 28.53	$ 878,213 244,319 12,880	$ 30,521 55,942 241		$ 869,245 241,109 6,862	$ 30,019 60,680 1,074	30.23 4.26 30.23	$ 907,460 258,496 32,453
Monetary items USD RMB Foreign currency liabilities
Monetary items USD

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The unrealized profits/losses of the foreign currencies with material impacts are as follows:

follows:
Foreign Currency USD RMB	From January 1 to March 31, 2021 Exchange rate Foreign exchange income or loss, net 28.53 $ 2,804 4.34 900 $ 3,704		From January 1 to March 31, 2020
	Exchange rate 28.53 4.34		Exchange rate 30.23 4.26		Foreign exchange income or loss, net
				(	$ 5,064 3,300) $ 1,764

XXX. Additional Disclosures

• (I) Information about significant transactions

• The amount of acquired properties is NT$100 million or more, or 20% of the paid-up capitals or more. (None)

• The amount of disposed properties is NT$100 million or more, or 20% of the paid-up capitals or more. (None)

• Transactions of the major core business items between the Company and the related parties, with the amount of NT$100 million or more, or 20% of the paid-up capitals or more. (None)

• The receivables from the related parties is NT$100 million or more, or 20% of the paid-up capitals or more. (None)

• Transactions in engaging in derivative financial instruments. (None)

• Other information: Amount of the business relationship and major transactions between parent company and subsidiaries and among subsidiaries. (None)

• (II) Information related to reinvested enterprises. (Table 1)

• (III) Information about investment in mainland china

The Company has no investment in Mainland China.

• (IV) Information about major shareholders: Name, shareholdings and percentages of shareholders with more than 5% shareholding. (Table 2)

XXXI. Information about segment

Based on International Financial Reporting Standards IFRS 8, “Operating Segments”, because the Company’s major business is a single business of non-life insurance, and when the management making the operational decisions, the applied company components are based on the holistic information of the Company, the Company is considered as a single operating segment, and the financial information of operating segments need not to be disclosed.

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Table 1. Information related to the Name, Location of the Investee:

Unit: NT$ thousand

Name of Investor	Name of Investee	Location	Main Activities	Original investment amount	Original investment amount	Holdings at end of period	Holdings at end of period	Holdings at end of period	Net income (losses) of the investee in period	Investment income (loss) recognized in period	Remarks
				End of the period	End of previous period	Shares (thousand shares)	%	Carrying Amount
Taiwan Fire & Marine Insurance Co., Ltd.	Top Taiwan X Venture Capital Co., Ltd.	Taipei City	INVESTMENTS	$ 198,000	$ 198,000	19,800	24.75	$ 256,126	$ 55,115	$ 13,641

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Table 2. Information about major shareholders:

Name of major shareholder	Shares	Shares
	Shares	Equity(%)
Bank of Taiwan Co., Ltd. Navigator Investment Co., Ltd. Yong-Shin Development Co., Ltd.	64,608,278 25,168,675 24,158,535	17.84% 6.95% 6.67%

Note: The information about major shareholders referred to in the table is based on the information about the shareholders holding more than 5% of the common shares (including treasury stock) of the Company for which the Company has already completed the non-tangible registration and delivery, as made available by TDCC on the last business day of the given quarter. The capital stock recorded herein might be different, or vary, from the number of shares for which the non-tangible registration/delivery has been completed, depending on the preparation basis.

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